Facebook Twitter Instagram
    Mortgage.info
    • First Time Homebuyer
    • Loan Programs
    • VA Programs
    • Refinancing
    • Beyond the Mortgage
    Mortgage.info
    Home»Home Refinance Loans»Why Do You Refinance, Let’s Count the Reasons
    Home Refinance Loans

    Why Do You Refinance, Let’s Count the Reasons

    JustinBy JustinNovember 9, 2016No Comments3 Mins Read
    Facebook Twitter Pinterest LinkedIn Tumblr Email
    Share
    Facebook Twitter LinkedIn Pinterest Email

    why-do-you-refinance-lets-count-the-reasons

     

    By now you know about the benefits of refinancing and how it can save you money. Savings alone is reason enough why there’s a need to refinance to take advantage of low rates while they last. Nevertheless, each homeowner has different needs. Unique circumstances have a hand as to why he/she wants to refinance. Why do you refinance?

    Talk to a lender now.»

    As one expert asks, “What do you wish to accomplish when you refinance?” A cursory look at online news reveals that the answer to that question can be as varied as they can be practical, simple, and more.

    To reduce the term of the loan

    Refinancing a 30-year mortgage to a 15-year mortgage is seen as a money-saving move in the long run.

    Why: Interest rates on a 15-year mortgage are typically lower than their 30-year loan equivalents. You also pay less interest because you’re halving the term it takes to pay down your mortgage, from making 360 payments to 180 payments. A 15-year loan also helps you build your equity faster. Just be prepared to make higher loan payments.

    To get rid of mortgage insurance

    Refinance is one of the best options to cancel or remove a private mortgage insurance (PMI).

    Why: PMI is expensive. If you’ve accumulated at least 20% equity or paid down 80% of the home’s original value, you won’t be required to pay a mortgage insurance. Just take note of any seasoning requirement – usually a two-year period required by lenders before you can refinance to remove your PMI.

    Discover today’s low refi rates.»

    To remove a second mortgage or home equity line of credit

    A second mortgage or a home equity loan can make things complicated when you refinance your first mortgage. Most often than not, the borrower and the second mortgage holder have to enter a resubordination agreement, which can be costly and complex.

    Why: Eliminating a second mortgage, a high rate one at that, eases your finances. Under Home Affordable Modification Program (HAMP) with Second Lien Modification Program, second mortgages can be modified or eliminated.

    To remove a co-signer (a parent or an ex-spouse)

    When you refinance, you take out a new loan and sign new documents that can reflect the removal or addition of co-signers or co-borrowers.

    Why: Unlike when you first took out the loan, you obviously can do away with your parents’ co-signing your mortgage debt. Also, after divorce, you practically cut ties with your spouse and your new mortgage is one document down.

    Access worthwhile refi deals here.»

    To take cash out

    Equity equals cash. This is an option afforded to homeowners who have chipped a larger portion of their mortgage principal.

    Why: Cash that is taken out of refi can be used to consolidate debt, pay off higher interest credit cards, student loans or car loans. It can also be used to fund an overseas trip, a home improvement project or a university education.

    Any of those reasons is good enough for as long as the benefits of refinancing would outweigh its costs going forward. Think it over, factoring your closing costs and the years you’re going to live in that house when you finally decide to refinance.

    Our lenders are here on a standby to help you refinance.»

    Justin
    + posts

    Justin McHood is a managing partner at Suited Connector and has been recognized by national media outlets as a financial expert for more than a decade.

    • Justin
      https://mortgage.info/author/justin/
      House Bill Adjusts HMDA Requirements for Small Lenders
    • Justin
      https://mortgage.info/author/justin/
      Senators Propose Measures to Protect Consumer Data Post-Equifax Breach
    • Justin
      https://mortgage.info/author/justin/
      HUD: $2-Bil. Funding to Fight Homelessness in Local Communities
    • Justin
      https://mortgage.info/author/justin/
      What Does the New Year Hold for HELOCs? Projections, Rates in 2018
    benefits of refinancing reasons to refinance reduce loan term refinance remove co-signer remove PMI take cash out
    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Justin

    Justin McHood is a managing partner at Suited Connector and has been recognized by national media outlets as a financial expert for more than a decade.

    Related Posts

    Don’t Overpay for Your Mortgage Refinance: Here’s How to Slash Your Costs and Save Big!

    November 22, 2022

    Should you Refinance your ARM into a Fixed-Rate Mortgage?

    November 5, 2022

    Cash-out Refinance for Extra cash: What you Need to Know

    October 31, 2022
    Mortgage.info
    © 2023 Mortgage.info Designed by ThemeSphere.

    Type above and press Enter to search. Press Esc to cancel.