Refinance Mortgage

Still paying a high interest rate on your mortgage? That extra money should be yours each month. When interest rates are 1% lower than what you are currently paying, it’s time to consider refinancing. This can mean great savings for you and your family. Replacing your existing mortgage with a new, lower interest loan, changing the term of your loan, or even consolidating all your debts into this new loan will save you money, both monthly and over the life of the loan.

A refinanced mortgage is one in which a borrower pays down an old loan with a new loan. People who refinance a mortgage tend do so to get a lower interest rate, lowering their payments or to take cash out of their home equity.

Benefits: Here are the main advantages of refinancing:

Refinancing your loan allows you to take advantage of improvements in your credit or drops in market interest rates.
A popular option when refinancing is what is called a "cash out refinance." When you do your refinance you can make a small increase in your loan amount and get the money out as cash.
Another benefit of refinancing is consolidating other high interest debts into your new home loan to save on interest expenses.
You can lower your monthly payments through refinancing.
The advantage of consolidating your debts into your home mortgage with a refinance is that your interest payments may not only be lower, they are also tax deductible.
If you are on an adjustable rate mortgage, refinancing is also an opportunity to lock in at today's rates on a fixed rate mortgage.

There are three ways refinancing can lower your payment. The first is simply to refinance at a lower interest rate. You can also change the term on your mortgage to lower your payment. Switching from a 15- to a 30-year term can significantly lower your mortgage payment. But, if long-term savings is more appealing to you, refinancing from a 30-year to a 15-year mortgage can save you thousands of dollars over the life of your loan. The third way to lower your payment is by switching from a traditional mortgage with principal and interest payments to a mortgage program that allows interest only payments.

Why To Refinance: You can go for refinance for the following reasons:

Refinance to Access Cash: Think of the equity in your home as a savings account that you could access through cash-out refinance.

Refinance to Pay Off Credit Cards And Other Debt: The difference between credit card debt and a mortgage can, financially speaking, mean thousands of dollars. Why? Credit card debt is compounded where the interest on a mortgage is simple, and often tax deductible. Using the equity in your home rather than credit cards to finance expensive purchases can save you money paid in interest in the long run.

Refinance to Convert An Adjustable Rate Mortgage (ARM) to a Fixed-Rate Mortgage: Use the length of time you plan on being in your home to your best financial advantage. It's about switching your mortgage to another mortgage lender, in order to lower the amount you're paying on your mortgage. In short a remortgage is about saving money.