Your house needs saving and you can save it. If you’re drowning in debt and wondering how to pay your mortgage each month, you have options. If you have no problem paying your monthly bills but you want to do something to breathe new life into your home, you have options. If you have recently been through some life changes and you need to have a financial cushion or a bigger house, you have options.
Reasons to Refinance Your Mortgage
There are many reasons to refinance a home. You may have gotten behind on payments, lost a job or need to remodel or expand your home. Whatever the reason, refinancing your home is an option available to you. It can lower your interest rate, which can lower your payments, and give you some breathing room in your monthly budget. It can also lock yo into a fixed-interest rate, which gives you peace of mind on what you can expect to pay each month. A refinancing can give you cash to pay other debts, or to buy other properties, too. If you already have two mortgages, a refinancing can combine the two. If you go through a divorce, refinancing your home can remove a spouse from the mortgage agreement.
Checking the New Rates
One of the biggest things you’ll want to know is what the refinance mortgage rates would be. Ideally, the refinancing process will lower the rates and lock them into a fixed rate for the remaining life of the loan. Currently, mortgage rates are lower than they have been in almost 10 years. This is a way to entice people to buy homes for the first time, but it’s also a benefit to those who already own a home because you can now refinance your previously high rates at a new lower rate. If you are considering refinancing, check into how much lower your rates will be before completing the process.
What You Should Know About Refinancing
Refinancing your mortgage isn’t an easy to decision to make. You should know that it can affect your credit. If you refinance more than once, it can lower your credit score. Even one refinance move can drop your score a few points. It also doesn’t always lower rates and it can extend the life of your loan. If you’re close to having your home paid off, refinancing can add more years to that loan and make you feel like you are starting over. If you’re goal for refinancing is to get cash now, you may want to consider taking a loan out against your mortgage. Basically, your home is collateral for a loan.
Refinancing your mortgage doesn’t have to seem scary or digressive. In fact, it can be a way to progress on getting your house remodeled, paying off other bills or just keeping your house instead of facing foreclosure. Knowing how it will help, the rates you’ll be facing, the ins and outs of refinancing and how this affects you in the long run can help you make the most informed decision.