For most families, their home is the largest investment they will ever make. As an investment, you should use your home wisely. Sometimes, this means considering refinancing your mortgage loan. There are several benefits to refinancing that you should consider. First, let’s learn more about refinancing your mortgage and what is involved.
What is Refinancing?
Refinancing is simply the process of paying off your existing mortgage loan by obtaining a new one. You still just have a single mortgage loan on your home that you pay each month. But refinancing can allow you to make some important changes that we will discuss more below.
How Does Refinancing Work?
Refinancing is similar to the initial process of obtaining your original mortgage loan. Let’s briefly look at each step:
Applying – When you apply to refinance, the lender asks for the same information that was required to apply for a mortgage: income, assets, debt, and credit score.
Better Rate Mortgage simplifies the refinancing process:
- Complete our simple home refinance analysis request
- Receive options based on your unique criteria and scenario
- Compare mortgage interest rates and terms
- Choose the offer that best fits your needs
Locking in the Best Interest Rate – shopping around can help you find the lender that offers the best interest rates for your area. Choose and lock in a rate so it doesn’t change before you close on your loan.
Home Appraisal – An appraiser estimates your home’s current value, just as when you were buying the home. The lender requires this to ensure they are lending against a home with enough value to serve as collateral for the loan.
Closing – This is the final step to signing the documents and paying off your initial mortgage loan so you can begin paying on the new loan.
Better Rate Mortgage guarantees this process to be faster than our competitors. We don’t waste your time with extra fees and long waiting periods.
Why Should I Consider Refinancing?
There are a variety of reasons for refinancing your mortgage loan. Most people choose to refinance for the following reasons:
Shorten Your Loan Term
Refinancing can save you money on interest charges by obtaining a shorter loan. For example, if you began with an initial mortgage of 30 years and a certain payment. Now you can afford a higher payment. Refinancing a new 15-year mortgage at a higher payment can often get a better interest rate, plus reduce the amount of interest you pay over time. You can also choose a longer mortgage term to reduce your monthly payment.
Lower Your Interest Rate
Refinancing can also save you money by allowing you to choose and lock in a lower interest rate. Since rates are always changing, you may encounter better loan conditions now and lock in a much lower rate with a new mortgage loan. This means you pay less interest over the term of your loan.
Get a Different Type of Loan
Different loan types have different advantages. You may have chosen a particular type for your initial mortgage, but now you qualify for a different type that could be more affordable or benefit you in other ways. Loan types for refinancing include:
- Fixed-Rate Mortgage
- Adjustable-Rate Mortgage (ARM)
- Conforming Loans
- Jumbo & Super Jumbo Loans
- FHA, VA & USDA Loans
A refinancing expert from Better Rate Mortgage can explain more about the different types of loans and how they can help you.
Cash Out Your Home’s Equity
You can refinance your home and borrow more than you owe to keep the difference as cash in your pocket. Use the extra money to consolidate debts, make home improvements, pay for college, or other needs.
When Should I Consider Refinancing My Mortgage?
Market trends and your own personal circumstances can often make refinancing a wise choice. Refinancing can often get a better interest rate than simple loans for college, home improvements, or other ventures. You can also save money over the term of your loan that you can use for other investments or family needs.
Better Rate Mortgage can help you refinance your mortgage loan faster and with less hassle when life presents opportunities. Speak with one of our refinancing experts today and explain your needs. They can answer questions and help you find the best options to meet your needs.
Better Rate Mortgage Can Make Your Home Investment Work for You!
Refinancing is a financial tool that can help you meet current needs, plan for the future, and save money. Get your refinance analysis now and get a rate quote in as little as 30 seconds!
