Considering refinancing you home mortgage? Here are a few things you must consider first before deciding to whether or not to refinance.
-If things have gotten tight recently and you don’t have a fixed interest rate or have a high-interest rate, then refinancing allows you the opportunity to lower your monthly payments at a smaller, fixed interest rate.
-If you love the location and home you are in and plan to live there for a long time the time extension on your loan may not be much of a sacrifice for you and could allow the ability to stay in your current location.
-Have two mortgages on your home? This can get costly and stressful. Refinancing can consolidate both loans to one lower monthly payment.
-Refinancing for lower monthly payments does include extending the time period on your loan, and could take you several addition years and perhaps decades to pay your mortgage off.
-If your credit score isn’t looking too good then refinancing won’t offer you a lower interest rate on your mortgage. If this is the case then simply making payments on time and cleaning up your credit score could offer you a better interest rate if you can afford to wait.
-Not planning to stay put? If a homeowner plans on moving within a year or two then refinancing isn’t a smart decision. It’s best to avoid refinancing if you plan on moving.