Refinancing your mortgage is a financial strategy that replaces your current mortgage with one that is more favorable to you. In today’s climate, refinancing may be a smart move so you can continue to make monthly payments or pay for home repairs.
Before you refinance, you must have enough equity built up in order for your home to be used as an asset in the refinancing process. If you are close to paying off your mortgage, refinancing will not benefit you.
You Want To Lower Monthly Mortgage Payments
Lowering monthly mortgage payments is one of the main reasons why homeowners want to refinance their mortgages. Refinancing replaces your current mortgage with a new one with better terms and rates, lowering your payments. When your interest rate is higher than current mortgage rates, talk to your lender about refinancing.
You Are Close To Retirement
If you are close to retirement, refinancing your home for a lower rate and payment will allow you to live more comfortably and afford payments. This is especially important for retirees that have reduced income.
Your Credit Score Has Improved
An improved credit score is another reason you should refinance your mortgage. When you refinance with a good credit score, your interest rates will lower—especially if you are refinancing for a shorter loan term.
You Want To Make Home Improvements Or Repairs
When you want to make improvements or repairs to your home, you can refinance your home with a cash-out refinance. This allows you to get money from your home equity straight into your pocket to use at your discretion.
There Are Closing Costs Associated With Refinancing
When you refinance your home mortgage, know that there are closing costs, application fees, and loan origination fees you will have to pay. Know why you are refinancing and refinance only when it makes financial sense for you. Refinancing your mortgage changes the current structure of your financing
The expert loan officers at SmartMortgage makes refinancing your mortgage loan easy!
The above information is for educational purposes only. All information, loan programs and interest rates are subject to change without notice. All loans subject to underwriter approval. Terms and conditions apply. Always consult an accountant or tax advisor for full eligibility requirements on tax deduction.