We all know that refinancing a mortgage to lower your rate is a smart move but did you know there could be other reasons to refinance your mortgage? With rates this low, now really is the time to understand advantages of refinancing.
Why is now a really good time to consider refinancing your mortgage?
I know it sounds like a broken record but rates are at an all-time low. So low in fact that they are considerably lower than they were just 12 months ago. And with purchase business slowing slightly for the holidays, your mortgage lender might have more capacity for refinancing loans right now.
What are common reasons to refinance?
To obtain a lower rate that will lower they payment if stay with the same term
Pay your mortgage off faster with a lower rate, same payment and shorter term
And a another important one is a cash-out refinance to either finance home improvements or to pay off other higher interest rate debt
What are reasons that people haven’t refinanced yet?
Usually it comes down to these reasons:
Refinanced or bought their house 12 – 36 months ago and don’t realize rates are lower now
Don’t think they have ability to refi because of debt or other issues
Afraid they won’t have enough money for the closing costs
Or feel there is too much paperwork and don’t want to take the time
Are these valid reasons or are there ways to overcome the perceived problems?
They could be valid reasons however all of them can solved most of the time because lenders offer so many different programs. For example, sometimes using the cash-out refinance, the issue of not having enough for closing costs or the concern with other debt being a problem can be resolved.
Any advice for those who are still not sure if they should consider refinancing?
Contact one of FORUM’s mortgage loan officers and talk about your situation. They will offer sound advice and even give you preliminary info before you have to commit very much time or any money to see if it makes sense. You might be surprised at your options and that fact that it can be relatively painless and definitely less time consuming than when purchasing a house.