Many experts project mortgage interest rates to swing for new highs. Since the election, the trend has been up, and the numbers show.
So before new norms kick in, many homeowners and investors are looking for the possibility to refinance, despite current market pressures. Taking advantage of today’s historic low rates can end up in hundreds – even thousands of dollars of savings.
If you are looking to reduce the amount of your monthly mortgage payments via lowering your interest or want to shorten your mortgage term, a refinance could be your answer. It’s also a feasible way to get rid of your mortgage insurance and a good opportunity to not only lower your payments but also take out cash to fund some home improvements, consolidate debt, or back some emergency expense.
[sc_content_link label=”Get today’s rates.”]
But however good your reason may be, the cost of closing a refinance could outweigh the benefits you can take out of it. It’s a tricky decision and is definitely not for every homeowner carrying a mortgage.
While refinancing one property could already take a lot of thinking, does that mean refinancing multiple properties is close to impossible?
The answer is it depends – on you and your lender. No, there aren’t any placed limits as to the number of properties that you are allowed to possess. However, there is a limit to the number of mortgages you can hold. You can only finance up to 10 properties.
Refinancing more than two homes
Still, it can be very difficult to refinance all ten properties. That means going through all that paperwork, crunching through possible liens, etc. The whole process can take months just to make sure everything is right. While it can be hard to find small lenders who will undertake such a courageous act, big lenders might be up for the task; it doesn’t hurt to look.
Meanwhile, refinancing for mortgages fewer than five could be a more plausible scenario, though that doesn’t save you from the hassle of disclosing your whole mortgage and financial portfolio for underwriting. If such is the case, experts advise that you refinance all the properties with the same lender to prevent any differences in DTIcalculations which can change your approval terms.
To get the best terms, pay down one mortgage more than the other, make sure your credit score is at its best without any errors, and have high equity on your properties.
But first, be sure you have a good grasp of the numbers and the risk that you are taking by rewinding the mortgage clock on your multiple real estate possessions.