There are many people asking the question should I refinance my mortgage
? There are various reasons why refinancing is a good idea for anyone that is in a good position to do it.
If you feel you are in a good position then you need to know the top reasons to refinance so you can make a smart decision for you. Below are the top reasons that you need to know about the most.
1. Lower monthly payment - When you refinance your mortgage during a time that interest rates are lower you will be able to get a lower monthly payment. This can be a big help to anyone financially that is struggling to make your mortgage payments each month.
2. Shorten the mortgage length - If your original loan was for a 30 year period by refinancing you can get that taken down to a shorter term or 10, 15 or 20 years if you have already been paying on your loan for some time now.
3. Equity - Refinancing will allow you to get a cash loan that you can use for other important things such as a college education or fixing up your home by using the equity that you have in your home. This will mean that your equity will decrease but you will have the immediate cash you need for important things.
4. Due away with mortgage insurance - For anyone that has built up over 20% equity on your loan you will have a very good chance of getting rid of this extra expense. This means that you will be able to get lower monthly payments also.
5. Switch types of mortgages - If you are on an adjustable rate mortgage and have decided that you would rather be on a fixed rate then by refinancing you will be able to make this switch much easier.
You want to be sure that you talk to your lender about this so you can be sure that you qualify for switching from adjustable rate to fixed rate. For a lot of people this won't be a problem but the lender is the one that will be able to tell you whether you are eligible or not.
Now that you know what these top reasons are you can see why for most people it is a good idea to refinance. Knowing these reasons can help you decide if you should refinance your mortgage? Just remember to take your time making your decision because this is too big of a decision to rush.