4 Reasons to Refinance

credit: Dan_H

If you’re steadily paying off your mortgage, you often don’t think about changing anything about the loan you have – you just keep paying, month after month, looking forward to the day in twenty years when the house will be yours. But there are some situations when it can be really advantageous to refinance your mortgage.

• When interest rates are low. Get a professional to help you with some calculations to see if the refinancing costs will be outweighed by the interest payments you can save by locking in your mortgage at a lower rate.
• If you have a better credit rating. In cases where your FICO score has improved, you might be able to get a much better financing deal. Or if you simply have an excellent credit rating, there will be plenty of lenders very keen to have you as a customer and they may offer you a better mortgage product than you already have.
• When you have more than one mortgage. If you can consolidate multiple loans into one, you will save on fees, and might be able to negotiate a better deal at the same time.
• Getting access to cash. Alternatively, if there’s a financial emergency and you need access to some extra cash, refinancing your mortgage may be a cheaper way to do this than adding to other forms of debt. But consult carefully with an expert before you take this step.

Tags: Finances | home equity loan | Lending | Mortgages | Saving Money