Refinancing has always been a boon to mortgage borrowers from all walks of life. While it’s not for everybody, it can offer you different opportunities to help improve your financial situation.
Although it involves an appraisal, title search, and certain fees, replacing your existing mortgage certainly is worth your while if…
You Desire a Lower Interest Rate
Any experienced real estate agent in Fairbanks, Denver, Salt Lake City, or any other hot market, would say that a refi gives you the chance to reduce the interest you’re currently paying.
Apart from helping you save dollars, it also lets you build home equity faster and reduce your monthly repayments. Most agents would agree that a 2% decrease in interest is enough savings for the trouble.
You are Sick of Variable Rates
The unpredictable nature of ARMs can sometimes keep you up at night, as you would never know when your repayments would increase. It may start out small, but periodic interest rate hikes can give you a heavier financial burden to shoulder.
Converting to a fixed-rate mortgage can give you the peace of mind you’ve always wanted.
You Want to Shorten Your Term
Shortening the term, even if it means slightly increasing the monthly repayments, is a mark of a smart borrower. If your budget allows, this move promises to be a smart decision.
You Need to Fund Huge Expenses
A cash-out refinance lets you tap into you property’s equity to access hard cash. This is useful when you need to finance something big, like a college tuition fee, a home remodel, or literally anything cashed-out money can buy.
You Wish to Consolidate High-Interest Debts
Debt consolidation is another brilliant utility of refinancing. But since starting out a new mortgage is a serious financial responsibility, exercise your due diligence before signing on the dotted line.
According to Hedgecock Group Real Estate, whatever reason you may have, it’s best to consult an experienced real estate firm to help you weigh all possible the pros and cons of this loan. As experts would say, only ignorance makes refinancing a risky bet.