3 Reasons to Refinance Your Home

The dream of affording a home is something that millions of Americans pursue every day. They work extra hard to be able to not only pay for their home, but also to pay for the repairs and upgrades that their homes need. Refinancing is one of the more reasonable and uncomplicated ways for you to utilize your home’s equity in your favor. Let’s examine three persuasive reasons that you might consider refinancing your home.

1. Lower Interest Rates

As the housing market fluctuates, so too do interest rates raise and lower. You can take advantage of low interest rates by refinancing and locking in to a fixed-interest loan. If you presently have an adjustable-rate mortgage, you may be able to get your interest rates lowered and thus allowing you to save money on your month-to-month mortgage payments.
If you’re a veteran or in the military, then refinancing for a lower interest rate may even be more appealing. Websites like Low VA Rates are friendly places to search for low-interest VA loans that lack the extensive complications that some newer lenders might have.

By refinancing with a considerably smaller interest rate, you can reduce your monthly mortgage payments and the overall amount that you might owe on your loan. This can make refinancing a win-win situation, especially if you’ve built some equity in your home already.

2. Reduce Your Monthly Mortgage Payment

Refinancing can allow you to switch your 15-year mortgage into a 30-year mortgage rate. Though it’s highly dependent upon your loan terms, you may find that this can lower your loan payment by $200 or more a month.

Even if you presently have a 30-year mortgage, you may be able to take advantage of a lower or fixed interest rate. This can reduce your mortgage rate and overall owed amount. All it really takes is filing some paper work and having an appraiser coming to your home for an appraisal. They will take a look of all the ins and outs of your home and will determine if you will be able to lower your interest and monthly mortgage rates. However, you will need to keep in mind that sometimes your mortgage and interest rates can also increase. This is just simply part of the risk you take, but most of the time your rates will be lowered.

3. Using Your Home’s Equity

There are many reasons you might need a few extra thousands of dollars. You might want to start your own business, to replace your home’s roof or to remodel some rooms of your kitchen. Refinancing can allow you to use some of your home’s equity to do just that.

“You just need to be careful about what you use that money for.”

You just need to be careful about what you use that money for. You should always strive to invest in ways that will raise your home’s value more than what you plan to spend or in some way that acts as a true investment rather than a solution for some quick cash.

Refinancing Can Make Your Life Easier

Refinancing can be one of the smartest things you’ll ever do involving your home. It can lower your payments, reduce the amount you owe for your home, and give you the money you need to invest in certain things.

Just remember to carefully weigh your options before you make a decision to refinance. It’s a choice that should only be made with a solid reasoning. This isn’t necessarily for everybody, but if you are looking to save some money from month-to-month on your mortgage payments and interest rates, then refinancing your home might be the way to go.

 

Tags: Mortgage loan, Refinancing

Category: Mortgage