When reviewing their mortgage, homeowners must consider the impact the rates are having on their finances. Are the rates rising or falling? What impact will a change in the variable rate have in the long-term? These are considerations to make when refinancing a mortgage loan. In this latest post, our experts present their guide to the refinancing process, including the considerations and the steps involved.
The Reasons to Refinance
Before taking on the process of refinancing your mortgage, let’s look at a few of the reasons that you might be considering this option:
- Refinancing to a fixed rate from your current ARM
- Cashing out for home improvements
- Lengthening your mortgage from 15-to-30 years to save monthly payments
- Debt consolidation to pay off high-interest credit cards
- Cashing out for various investment purposes
Review Credit First
Before even applying for the refinancing of a mortgage loan, the first step is to review your credit. There are many elements that can negatively impact your credit rating. One is applying for credit cards regularly. This can be a problem even if you have paid your credit cards off. Continuously applying for credit cards shows you regularly need access to additional funds, which may lower your creditworthiness in the eyes of a potential lender.
Repair Credit Problems
There are many steps you can take to begin repairing your credit. First and foremost is to begin paying off your debts, with the highest interest rate being the highest priority. Even if you don’t pay off each of your debts before you speak with lenders, you can show you have a plan to balance your financial obligations in the future.
Speak with Your Lender about Rates
Find out about the current rates within the marketplace – how do they compare with your current interest rate? Will you be paying more or less if you refinance now? Make sure you consult directly with your lender to determine the possible options available to you. One of the foremost challenges many people face is a rise in rates as a result of market volatility. Rates can change daily and in order to avoid interest rate increases, consult with your lender today to become pre-approved for the proper mortgage financing to meet your family’s needs!
Working with a trusted lender such as Summit Mortgage Corporation, you can save money when refinancing a mortgage loan. To discover more about the refinancing process, consult with our qualified team today. Call now to see how much you can save.