Refinancing Your Home Loan? When Should You Refinance Your Home?


Visitors: 632

If you have a current mortgage and are unhappy with the interest rate or the amount of the monthly payments, it is possible to refinance your home and eliminate your problems. But before you call your lender, there are some questions that you should ask yourself in order to determine whether or not it’s the right time for refinancing your mortgage loan.

The first question that you should ask yourself is if you have the cash on hand to pay the fees. Depending on the amount of your mortgage, and the specific fees that your lender will charge, you could pay anywhere from a couple of hundreds dollars to a few thousand. Be sure that you’re financially ready for the move before applying for the loan.

Next, you should take a look at the current interest rates compared to the ones on your existing mortgage, and then decide whether or not a refinance would help your situation. For example, if you have an ARM mortgage, and the interest rates are at an all-time low, you might want to refinance your loan and turn it into a fixed rate so your payments won’t go up again as rates rise. In addition, if you have a fixed rate, but bought your home when interest rates were higher, you might want to refinance in order to lower yours.

If you find yourself with a lot extra debt, you could take advantage of a cash-out refinance loan. With this type of loan, you add on an amount to your home loan, refinance the entire thing at a lower interest rate, and then take the “extra” money out and pay off your debt. This will allow you to reduce the amount of debt you owe (because the interest rate will be lower), and at the same time, reduce the amount of the monthly payment.

Most experts agree that you shouldn’t go to the trouble or expense of refinancing your home if you don’t intend to stay in it for at least three years. Otherwise the cost of the process would likely be more than the overall savings.

To view our recommended sources for mortgage refinance loans, visit: Recommended Refinance Mortgage Lenders Online

Carrie Reeder is the owner of ABC Loan Guide , an informational website with articles and the latest news about various types of loans.


Article Source:

Rate this Article: 
The Cost of Refinancing - What Costs To Expect When You Refinance Your Home ..
Rated 4 / 5
based on 5 votes

Related Articles:

Home Mortgage Refinance Loan - Choose a Loan, Not a Lender, When Refinancing

by: Louie Latour (January 21, 2007) 
(Real Estate)

Home Loan Mortgage Loan Refinance - Refinancing For A Shorter Term To Save Money

by: Carrie Reeder (October 18, 2005) 
(Finance/Mortgage Refinance)

Refinance Mortgage Loan: The Basics of Refinancing Your Home Loan

by: Louie Latour (October 28, 2006) 
(Real Estate)

Refinancing Online - Get The Best Refinance Home Loan You Can Get

by: Carrie Reeder (April 13, 2005) 
(Finance/Mortgage Refinance)

Mortgage Refinancing – Why Refinance Your Home Loan?

by: Louie Latour (November 12, 2006) 
(Real Estate)

How to Get a Low Refinance Rate When Refinancing Your Home Mortgage Loan

by: Carrie Reeder (November 16, 2005) 
(Finance/Mortgage Refinance)

Texas Refinance Loans - Refinancing Your Home Loan a Second Time

by: Jane Hale (November 27, 2006) 
(Real Estate)

Refinance Your FHA Home Mortgage Loan - Refinancing With The Streamline Process

by: Carrie Reeder (September 13, 2005) 
(Finance/Mortgage Refinance)

Home Mortgage Loan Refinance - Benefits To Refinancing Your House Online

by: Carrie Reeder (March 26, 2005) 
(Finance/Mortgage Refinance)

The Cost of Refinancing - What Costs To Expect When You Refinance Your Home ..

by: Carrie Reeder (September 13, 2005) 
(Finance/Mortgage Refinance)