To some people, remortgaging might seem as a no-brainer. This is especially so if they have a good chunk of equity on their homes. However, saving money with a lower mortgage shouldn't be the only thing you consider.
There are many more factors you should consider when it comes to a remortgage such as costs to remortgage and the situation of your personal living. This article will explain some of the things you should check before making any move.
The period you intend to stay in your house If you intend to move to another house in the next few years, it would be wise to keep your current mortgage. This is because chances are that you won't have time to recover the cost of the remortgage before you move out and sell the house. However, if you intend to live in it for a long period, a good idea would be to remortgage.
Date to retirement
If retirement is just around the corner, you would be better off taking a short term loan. This one is given at lower rates than the long term ones and you will have enough money to last you through your retirement.
Predictability
If you plan to stay in your home for an extended period of time, a fixed rate mortgage would be a good way to go. This is so because even if the remortgage payments are not lowered, you won't have to worry about them increasing since there is security with fixed rates.
The cost of remortgaging
Your remortgage may be offered to you with points and fees. Learn about your lenders cost of remortgaging by checking out their Good Faith Estimate and make an application. These points and fees may add up to thousands of dollars. You may find fees and points for loan origination, application, appraisals, escrow, inspection discount points and mortgage insurance. You also have a choice to picking a higher interest rate which may lead to the lender absorbing some of the cost sometimes all of it.
Cash-Out Refinance
Some people do cash-out refinancing to pay the credit card debts. They do this because it sometimes saves on taxes and the rates are lower. There is however a downside to this strategy. At first, your debt is dischargeable in bankruptcy and unsecured but once you do the cash-out remortgaging, the whole thing is no longer dischargeable and is now secured by your home.
Taking all the remortgage tips you can before you make any move will help you make wise decisions and save a lot of money and time.
Article Source: http://EzineArticles.com/5189516
There are many more factors you should consider when it comes to a remortgage such as costs to remortgage and the situation of your personal living. This article will explain some of the things you should check before making any move.
The period you intend to stay in your house If you intend to move to another house in the next few years, it would be wise to keep your current mortgage. This is because chances are that you won't have time to recover the cost of the remortgage before you move out and sell the house. However, if you intend to live in it for a long period, a good idea would be to remortgage.
Date to retirement
If retirement is just around the corner, you would be better off taking a short term loan. This one is given at lower rates than the long term ones and you will have enough money to last you through your retirement.
Predictability
If you plan to stay in your home for an extended period of time, a fixed rate mortgage would be a good way to go. This is so because even if the remortgage payments are not lowered, you won't have to worry about them increasing since there is security with fixed rates.
The cost of remortgaging
Your remortgage may be offered to you with points and fees. Learn about your lenders cost of remortgaging by checking out their Good Faith Estimate and make an application. These points and fees may add up to thousands of dollars. You may find fees and points for loan origination, application, appraisals, escrow, inspection discount points and mortgage insurance. You also have a choice to picking a higher interest rate which may lead to the lender absorbing some of the cost sometimes all of it.
Cash-Out Refinance
Some people do cash-out refinancing to pay the credit card debts. They do this because it sometimes saves on taxes and the rates are lower. There is however a downside to this strategy. At first, your debt is dischargeable in bankruptcy and unsecured but once you do the cash-out remortgaging, the whole thing is no longer dischargeable and is now secured by your home.
Taking all the remortgage tips you can before you make any move will help you make wise decisions and save a lot of money and time.
Article Source: http://EzineArticles.com/5189516
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