Did you know that about 66% of all applications that home loan lenders like HomeSure Lending receive are not actually from people who want to buy a home? They are from people who already have a home and want to change the terms of the loan they already have.
Refinancing became very popular as our country started to emerge from the recent recession. Mortgage rates were still very low, but property values were beginning to recover. Homeowners could get much better loan terms while remaining in the same home, which made it even more affordable to continuing investing in that property.
Most people refinance because it can same them time or money. In some instances, for example, a homeowner could refinance a 30-year fixed loan in to a loan that was only half that long. The most common reason someone refinances, however, is to take advantage of a lower interest rate. They essentially convert their old loan into a new one using that new rate so they have lower monthly payments and pay less money over the life of their mortgage.
Is Refinancing for Me?
Refinancing might be a good option for you if you intend to stay in the house for the foreseeable future, or at least for the next five years and beyond. However, if you are planning on moving out of your home in the next two to three years, refinancing might not be the best option for you. Refinancing does come along with a number of fees, which can sometimes be rolled into the loan, but will make refinancing more expensive than just paying the old rate if you are going to try to sell your home soon.
Refinancing also might not be the best option if it will significantly extend the length of your mortgage. While it is possible to refinance into a shorter mortgage term, if you are simply refinancing for a lower interest rate, you might see five to ten years tacked on the original length of your mortgage.
The Bottom Line
Refinancing is a great way to get a better loan without actually having to apply for a brand-new home loan. If you have a positive financial history or if refinancing would lower your monthly payments to a more manageable amount, you are more likely to be approved to refinance your loan than you would be for a new home loan.
Interested in Refinancing? Apply now and you’ll be speaking with a HomeSure Lending mortgage professional today.