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Homeowners Should You Refinance Your Home?

Homeowners, are you considering refinancing your home? There are reasons to refinance and reasons not to refinance. Homeowners Should You Refinance?

Homeowners Should You Refinance Your Home?

Homeowners, Should You Refinance Your Home?

There are several reasons to refinance

  • reduce monthly mortgage payments
  • reduce mortgage interest rate
  • consolidating a first and second mortgage
  • converting from adjustable to a fixed mortgage rate
  • consolidate debts
  • home remodeling or repair
  • pull-out cash
  • do not want to sell my home

Homeowners considering refinancing is a decision only the homeowners can make. June 2015 the interest rates were around 04%. Mortgage rates are low. There are things to consider before refinancing.

Reasons to Refinance Your Home:

Homeowners Should You Refinance Your Home?

Homeowners, Should You Refinance Your Home?

  • Existing loan’s interest rate higher than current mortgage rates.
  • Convert from an adjustable rate to fixed rate mortgage.
  • Consolidate mortgages (example consolidating first and second liens)
  • Convert from a 30-year loan to a 15-year loan.
  • Refinancing with lower mortgage interest rate should reflect substantially lower monthly payments
  • To consolidate debts.
  • Make necessary deferred maintenance on the property.
  • Home improvements that will increase the value of the home.
  • To get rid of Private Mortgage Insurance (PMI).
  • Convert some of the home equity into cash. 

Reasons Not To Refinance

  • Existing loan 10 years or less remaining years and new loan 15-30 years. Does it make sense to refinance?
  • Cost of the refinance? What are to total fees for the new loan (points, appraisal, closing costs, etc)?
  • Considering lenders fees (closing costs) is the rate of returns after refinancing beneficial?
  • Compare your existing interest rate to current market rates?
  • If you are considering selling your home in next few years does it make sense to refinance NOW?
  • Is the value of your property increasing or decreasing? Is the equity in your home enough for a refinance?

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