Friday, March 28, 2008

Home Mortgage Refinancing – What are the Reasons You Need to Consider

There are many reasons why you may wish to consider home mortgage refinancing. So what are these reasons and how can they justify you getting a home refinancing?

More and more homeowners around the country have decided to refinance their home to consolidate debts, for making home improvements or to pay off their mortgage faster.

If you are considering home mortgage refinancing, it is a good idea to first understand what is actually involved in refinancing your home. Home mortgage refinancing involves obtaining a secured loan in order to pay off an existing loan. In most cases, the loan will have been secured by either property or some other type of assets. The most common reason for refinancing a home mortgage is to take advantage of a lower interest rate. This is especially true in the event you have had an adjustable rate mortgage or you financed your home some years ago.

Even if it does not seem that interest rates have gone down that much since you first financed your home, you may be surprised to learn how much difference even a small amount of interest reduction can make in your payments. In addition, changing circumstances may allow you to now qualify for a lower interest rate that was not possible when you financed the home. This is because interest rates are not only based on the prevailing interest rate at the time you finance the home but on other factors as well including your down payment amount and your credit rating. If your credit rating has improved since you first purchased your home, you may be in a very good position to now qualify for a lower interest rate with a home mortgage refinancing.

Another common reason for home mortgage refinancing is to actually reduce the length of your mortgage loan. For example, if you originally had a 30 year fixed rate loan you might wish to consider refinancing to a 10 or 15 year loan. This type of mortgage refinance allows you to pay off your mortgage sooner and over the duration of the loan save far more money in interest payments. In many cases, you may also be able to take advantage of receiving extra cash from your refinance while lowering your monthly mortgage payments if rates are lower. Of course, another option would be to keep your payment the same and pay off the loan even faster while also enhancing the equity.

You might also consider refinancing your home in order to pay off higher interest credit card bills. Typically, the interest rate you will be able to obtain on a home mortgage refinance loan will be lower than what you pay on your credit cards. There is also the convenience factor of being able to only pay a single loan payment every month versus multiple credit card payments. You should understand that with this type of loan, your home will serve as security for the loan until it is paid off.

Regardless of which type of home mortgage refinancing you ultimately decide is best for you, it is important to remember that you may also be able to take advantage of important tax advantages as well. Consult your tax advisor to find out whether you can deduct the interest on your home equity loan. You may be surprised to discover that it is completely tax deductible; something that can not be said for credit card interest.

Which home refinancing option is best for you? Find out more about the benefits of refinancing your home at Home Mortgage Refinancing or Home Mortgage

Saturday, March 22, 2008

Home Loan Refinance Offers Advantages When Timed Right

Why do homeowners go for a home loan refinance? If you want to know more, continue reading this article.

If it has been at least a year since you purchased and financed your home, it could be a good idea to consider refinancing your home. A home loan refinance offers great financial advantages under the right circumstances. In order to make sure you get the most benefits of refinancing; however, it is important to make sure you consider whether now could be right time to refinance your mortgage.

At one time, financial experts recommended that you only refinance your home if interest rates had dropped at least two points below the interest rate you obtained on your mortgage at the time you purchased your home. Today, that rule is no longer applicable. Even if the prevailing interest rate has not yet reached the benchmark of being two points lower than your mortgage interest, you can still take advantage of lower payments and interest savings.

The key to taking advantage of these benefits; however, is in balancing the cost of your home loan refinance with the amount of money that you will save. Certain costs are associated with refinancing, including application fees, credit reports and a possible title search.

Generally, it is a good idea to go ahead and refinance when you think you will be in the home long enough to offset the cost of the refinance with the amount of money you will save each month over the long run. For most homeowners this is about two years; however, that time frame could be largely dependent on exactly how much money you are able to save every month with a home loan refinance and how much it costs you to refinance. If you find that you are able to save more money when you refinance your mortgage, it will not take you very long to recoup the cost of the refinance through your savings.

Let us consider an example. Suppose you have a fixed rate mortgage for $150,000. Your current interest rate is 7%; however, you are able to achieve a 5.5% interest rate with a home loan refinance. On the original mortgage you would be paying $998 per month on a 30 year loan. At the new interest rate for the same length of time your payment would drop to $851 per month; amounting to a savings of $147 per month. If; however, your original interest rate was higher at 7.5% then you would save almost $200 per month. With an average closing cost of $3,000 on your home loan refinance, it will take just 15 months to recoup the costs of refinancing your home. After that time has elapsed, you can begin really enjoying the savings offered by refinancing your home. If you plan to be in your home for a long period of time, this provides you with the opportunity to take advantage of substantial savings.

In some cases; however, it can still be advantageous to refinance your home even if you think you will be selling in the short-term. For example, if you believe that your home has appreciated in sufficient value so that you will make enough profit on the sale of your home, it could very well be worth it to go ahead and consider refinancing to take advantage of the monthly savings in the interim.

Make sure you have the resources you need to determine how much money you could save with a home loan refinance. Visit Home Loan or Home Loan Refinance to find out how much money you might be able to save every month.

Friday, March 14, 2008

Home Mortgage Loan Refinance is Beneficial in Numerous Ways

Traditionally, homeowners have made the decision to take advantage of a home mortgage loan refinance in order to lower their interest rates. There is still a lot of value in doing so; however, homeowners have also learned that there are many other advantages to refinancing their homes as well.

A home mortgage loan refinance is a viable solution for many homeowners in a variety of different circumstances. Not only can you save money by refinancing your mortgage, but you may also be able to find your way out of a difficult financial slump as well.

Lower interest rates are one of the most popular reasons for refinancing a home loan. In fact, many people still consider lower interest rates to be the biggest advantage of a home loan refinance. There are two reasons why you might wish to refinance your home mortgage loan for a lower interest rate. First, you have a fixed rate mortgage but the rate on your mortgage is higher than current interest rates. Second, you have an adjustable rate mortgage and you are tired of living with interest rate changes on your mortgage loan. In either case, a home mortgage loan refinance can help to solve your problems.

A home refinance also offers you the opportunity to obtain additional funds that can be used for a variety of expenses. Perhaps you want to make some improvements to your property in order to raise its value. Maybe your child is about to head off to college and you need to cover his or her tuition and expenses. It could be that you simply need some extra cash for some other purchase. Taking advantage of a home mortgage loan refinance gives you the tools and the funds you need to pay for those items at a lower interest rate than you would be able to obtain through any other method, especially credit cards.

Another benefit of refinancing your mortgage is the ability to pay off high interest bills. More and more homeowners are taking advantage of the opportunity to consolidate their higher interest credit card bills and other debts with a low interest home refinance loan. This allows you to pay off your bills faster and you may also even be able to take advantage of tax deductions as well.

Of course, it must be pointed out that it is also possible to refinance your home loan for a shorter period of time in order to pay it off sooner. It is not uncommon for many home buyers to need a lower monthly mortgage payment when they first purchase their home. A few years later circumstances may have changed and you may be in a better financial situation. In this case, you may wish to begin making larger monthly mortgage payments. Refinancing to a shorter mortgage term with a lower interest rate will help you to pay off your mortgage in record time and save money while you are doing it.

A home mortgage loan refinance presents numerous benefits and advantages to homeowners who want to put the power of the equity in their home to work for them. Whether you want to pay off bills, make a purchase, save money or pay off your mortgage sooner, refinancing your home gives you the ability to do so.

Discover the benefits of a home loan refinance at Home Mortgage Loan or Home Mortgage Loan Refinance. You will find the best refinance options available for your refinance needs.

Thursday, March 6, 2008

Home Loan Refinance - Know How to Prevent Getting Tricked

Home loan refinance can be one of your best options if you still want to have ownership over your home. However, you should also be very careful on the different traps that go along with it.

At least once in your life you dream of living in a comfortable home. It can be located in a city or suburb, where you can raise your family well. Yet with the increasing prices of homes today and the way income hardly changes, there will always come a time when it is going to be very difficult for you to settle your monthly home mortgage loan. Hence, before you become another victim of foreclosure, consider a home refinancing.

A home loan refinance carries a number of benefits. For one, you can have enough cash to pay off whatever pending dues you have, even including interest. Moreover, you can have the opportunity to extend your payment term, so you will be able to lower down your payments every month and save enough funds to pay off other debts. Nevertheless, there are also several traps that you need to avoid, if you do not want to consider your application for a home refinancing totally futile:

1. Do not apply for a home loan refinance in your current lending company. It is actually simple logic. Why would you consider submitting an application for a home refinancing in your old lending institution when it cannot provide you of better interest rates? At first glance, you may realize that the lender can present small interest charges than before; however, the payment term can be extended that it almost appears as if you are still paying the same amount as with your previous loan.

2. Do not go for variable rates for your home loan refinance. There are some companies that can offer you variable interest rates for your refinance. This can happen at the early part of the mortgage. The problem, however, is since it is variable it can increase tremendously, which may mean you will even be paying more interest compared to what you usually pay with your old loan.

3. Know if you will be able to really save money with the options you have for home loan refinance. It is important that you can conduct a break-even analysis before finally choosing your lender. The process is very simple. All you need to do is to divide the cost of your transaction to the savings you can get every month. This way, you will be able to know how long you will likely break even from your expenses. For example, if the cost is $1,500 and you will likely save $40 every month, then you can recuperate from the cost around 38 months. If you think you want to live at the same house within that period, then you have to refinance.

4. Avoid going for a loan with higher interest rate. When the interest rate is high, you can shorten your payment term. Nevertheless, before you say go, ensure first that you have made the right decision. One way to check is to look at the APR of your recent mortgage. The interest rate should be lower than what is being offered in your old loan.

You need the help of an expert when it comes to home refinancing. This is to ensure that you don’t end up getting the worst end of the deal. At Home Loan Refinance or Home Refinancing, we can offer you options that will suit your needs and your preference.