REFINANCE

REFINANCE

Before you get started you have to first decide whether or not refinancing your home loan is a good decision or if you should just stay with your current home loan. The best way to figure out if you need to refinance is to ask yourself a few easy questions. Do you often find yourself short of cash during the month? Do you wish you had more money to spend on other things? Are you constantly stressed out about your current financial situation? If you answered yes to any of these questions then refinancing is for you.

More times than not an individual who refinancing not only saves money but they also are able to get a lower interest rate, so they actually save money in two different ways. Obviously an individual wouldn’t come to this site unless they wanted to save money, and that is exactly what we are trying to do for you.

Refinancing Tips

Refinancing your home mortgage can come with some great perks. If you do it with no money out of pocket, you can skip one to three mortgage payments. You can save money on your payment or pay off your entire mortgage faster when you have better terms.

Here are a few things to pay attention to when you refinance your mortgage loan, to make sure that you don’t overlook anything that you might regret, or that can cause problems later.

1. Apply for a pre-approval loan to different lenders to make sure you are getting the lowest rate possible. When you do this, make sure that with the initial pre-approval application, the lender is not pulling your credit history. You will want to reserve your credit pull for the lender that you are most likely to work with. You can decide that after you have gone through the preliminary pre-approval process with a few lenders.

If you have too many inquiries, it could keep you from refinancing your mortgage loan with the lowest rate possible. When you pre-apply for home mortgage loans online, most lenders or mortgage service companies will not initially pull your credit. They will usually tell you whether or not they are going to pull your credit. If, on the application, they ask you to describe your credit, they are probably not pulling your credit.

2. Make sure that your original mortgage does not have a pre-payment penalty or early payoff penalty of any kind. Sometimes people will get into their mortgage with the mortgage having a pre-payment penalty and they will not even know about it. Pre-payment penalties usually range from 6 months to 3 years with a penalty for an early payoff. The penalty is usually about the amount of 6 months’ worth of your mortgage loan interest, but this varies.

You would have to be able to have some significant payment and interest savings on your refinance loan to justify refinancing a mortgage loan with a pre-payment penalty.

3. When evaluating different lender offers, in the mortgage loan pre-approval process, pay closest attention to the interest rates they are offering & the closing costs. These are the two biggest factors that will help you figure out which lender is right for you. If one of these two factors is too high, it could offset the benefit of refinancing for you.

4. Get your interest rate and closing costs in writing as soon as you decide on a lender to work with. Get your lender to give you a commitment in advance of all of the costs that will be involved with your loan. Find out if the refinance loan you are getting has a pre-payment penalty as well. Sometimes lenders will leave out important information like this, if they think it might scare you away from refinancing with them.

5. Ask for the reissue rate on your title work. If you’ve taken a mortgage within the past two years, or are using the same lender, you might be granted this option, which can save you as much as 70 percent on your title work. An editor at this magazine didn’t know about this potential savings when he refinanced his mortgage; fortunately his lawyer did. The savings more than covered the attorney’s fees. However, if it’s been several years since you took out a home loan, or if you’re using a new lender, you’ll likely have to pay for a new title.

Bad Credit Mortgage Refinance
Now another striking question that might disturb you is that: “In a situation covered in debts, I already am on an all-time low in terms of making payments. As a result, my credit scores have plunged downwards, even rapidly. In such a state of affairs, it is completely advisable to go for mortgage refinancing loans. There is a special type of loan called the Bad credit mortgage refinance loan, which becomes ready to lend a hand. Mortgage refinancing loans are available for bad credit or credit-challenged customers as well. They have even lower rates of interest for repayment. Besides, repayment period is extendable and well-negotiable. This in turn becomes functional in reducing your monthly expenditures – also in terms of your debt repayments.

Getting home loan refinance is a very productive pick chosen by a number of people nowadays. It is doable, easy and extremely productive. Home Loan Refinance has begun to gain immense popularity nowadays. Only thing one needs to take care of, while opting for such refinance mortgage loans is to stay away from false claims and get the best suitable choice for yourself that in fact aids in reducing your overall monthly expenditures made after the repayment of debts.

Refinance Mortgage Rules
Rule 1: Watch your Rate and your Terms.
When you refinance your mortgage you should do it because you qualify for a lower interest rate. You can pre-qualify for a refinance. As with any mortgage before you sign the papers you should be sure that interest rate and terms of the loan are the same.

Rule 2: Consider the Length of the Loan.
If possible you should refinance your mortgage so that you do not add additional time to your loan. You can do this by choosing a shorter loan length, which will increase the amount that you would pay. The longer the term of the loan the more you will pay in interest on the loan.

Rule 3: Don’t Draw Equity Out of Your Home.
Often when people refinance they do it to draw out the equity of their home. They may use the money for home improvements, to pay off other debt or to finance a wedding or college education. When you pull out the equity you are extending the life of the loan and increasing the amount of interest you will pay. This is a dangerous step, because many people often find themselves in the same situation in a few years.

Rule 4: Don’t Refinance to an ARM.
If you are refinancing to save money on your mortgage payments be sure that you lock in a low rate instead of going with an adjustable rate mortgage. An adjustable rate mortgage will adjust to a higher interest rate in a few years, which will raise your payment amount.