When is the best time to refinance? How do I know if refinancing is good for me or if it will benefit me? How long will it take me to recoup the closing costs of a refinance? These are a few of the questions that many ordinary people ask everyday about refinancing. You should contact a mortgage professional to answer these questions for you specifically because refinancing is different and accomplishes different things for each consumer. A good time to refi, or refinance, is when you are looking to lower your monthly payment because the rates have decreased from when you obtained your loan, your financial situation has changed, you would like to switch your loan from a fixed rate to an adjustable rate to lower your rate and monthly payment, or you have decided that you need to increase your loan term because your payment is either too high or not within your budget at this time. Email me at dave@gofirstsecurity.com to obtain your free mortgage analysis and find out if refinancing would benefit you currently and by how much.Have your credit scores changed drastically recently? If you had low credit scores a few years ago, but have since worked on paying down high balance credit cards, paying off collections, or if you have a bankruptcy that has been discharged, then you may be in a situation where refinancing will save you a lot of money.
Understand what you are trying to achieve by refinancing. Once you identify your objective, your mortgage broker can easily help you accomplish your goal. However, be realistic about what you can accomplish. For instance, while it is possible to get the most equity out of the house or shorten the loan terms, do not expect to "cash-out" the highest amount possible from the equity of your home and expect the lowest interest rate with the lowest monthly payment.
Many times refinancing will not necessarily yield you a lower interest rate. Several factors could have changed from the last time that you went through the loan process. Your credit score could have dropped, less income, or your LTV may be different. It would still make sense for you to refinance if you are consolidating high interest credit card debt. Your total monthly payments would drop, and you may have more tax deductions with a slightly higher mortgage interest rate. Debt consolidation refis are a great way to get your financial goals back on track.
