There are many reasons why you may choose to refinance your home loan. Homeowners normally refinance their mortgage when interest rates drop and they wish to shorten the term of their mortgage and pay less in interest payments. Depending on the terms of your current mortgage, you may be able to adjust the interest rates and save some money. Reducing the interest rate of your mortgage will help you save money while increasing how fast you are able to build equity in your home. To learn more about refinancing your mortgage from the Best mortgage lenders in Atlanta, continue reading below.
The Refinancing Process
Homeowners that bought their homes a decade ago are likely to be paying a higher interest rate compared to homeowners who purchased their homes in the last few years. With lower interest rates available, it’s not a bad idea to refinance your mortgage, especially when you can save money on monthly payments or on the overall interest rate costs.
Things to Know Before Refinancing Your Home
The refinancing process requires you to obtain a new loan either with your current mortgage lender or with a new lender. The refinancing process requires less time to be completed if you process with your current lender, as they should have all the necessary information required to create the new loan.
Before you make a decision on whether you should refinance your home, you should consider the following factors.
The time you plan on staying in your home:
One of the main benefits of refinancing your home is that with lower interest rates you can save big over time. If you are planning on selling your home in a year or two, it would not make sense to pay the costs required to refinance your home.
The amount required to complete the refinancing process:
Depending on the loan terms and your lender, you may be charged a few hundred dollars or as much as 3 percent of the new loan to complete the process. If you are not planning on selling your home anytime soon this may be a good option but if you are, it may not be worth it.
What's Your Home Worth?
A new mortgage loan could add more years to your current mortgage
When refinancing, you are basically getting a new loan and you could be adding more years to your current mortgage. For example, if you are already 10 years into your current mortgage, adding 30 years more would not make sense, especially since you may carry the debt past your sixties. You could choose to refinance your home with a 15-year mortgage, but it might require you to pay more interest over all.
When it comes to refinancing your home, you should learn about all the advantages and disadvantages. Speaking with an experienced mortgage lender can help you learn and choose the right refinancing option for you. To learn more about the refinancing process visit the following link: https://moreirateam.com/
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