Advantages of refinancing your home
Getting your loan refinanced may appear a very risky decision and you may not feel inclined to go for it. However, there are certain advantages of this option that can help you get to a decision. These advantages are:
- Mortgage refinancing lowers the monthly mortgage payments. Moreover, you can also secure a lower variable rate that may even drop further in the future
- Refinancing can also help you in paying less in total interest on your mortgage
- You can even choose a lower term to pay off your mortgage which means you can pay your mortgage off faster
- A better credit records will help you qualify for a lower interest rates
- Refinancing helps you to unlock the equity in your home
Requirements for Refinancing
The refinancing requirements can be classified in three categories:
- Financial requirements
- Equity requirements
- Closing cost requirements
- Financial requirements – If your loan is at default then there are very low chances that will be offered refinancing as no mortgage company wants to lend money to a borrower who is unable to make their payments.
- Equity requirements – Most of the lenders expect the borrower to have some equity in their homes as they want the value of the home to be higher than the amount the borrower wishes to borrow.
- Closing costs requirements – The borrower must pay closing costs that include appraisal fees, prepaid interest or points, title search fees, title insurance and loan application fees.
Apart from these requirements the borrower is supposed to apply through a formal loan application. Without the complete application the lender cannot determine whether the borrower qualifies for a refinance loan.
Refinance your home today
Refinancing your home can be an easy task if you have the right lender. Speak with one of our Refinance Lenders today at 877-342-7449 and get the best deal.