Refinancing mortgage is one way to make your loan low. But it ain’t saving your money even the rates are low. Sometimes it will costs and rates vary on a case by case basis. This is the main answer you must know before do refinancing :
1. Will you get lower interest if refinance? That’s the main question you need to answer before make action. Look at the interest rate whether it is worthy or not. If you not really confident about it talk with your mortgage broker to find it
2. Look at your credit score. Maybe some of us don’t think credit score is important to refinance. That’s wrong because some of lenders will look at your credit score. Always look at your credit score to ensure you can make a refinancing and not waste time.
3. Refinancing still have cost. You must check the refinancing fees including
– Loan origination
– Home inspection
– Home insurance
and many more costs. Just check whether you can afford or not.
4. Planning on how long you want to stay at the house. If you want to move within 5 years, than do refinancing is just waste money/time (not if you rent it). You must determining your future plance before make refinancing plan. The refinancing is worthy if you want to own the house for long time.
5. Some of mortgage has a pre-payment penalty. Check your regulation if your mortgage has penaly for pre-payment. Check the cost of penalty whether it is worthy or not to make refinancing.
6. Look at your job. Will you work for long time or short time. Banks need to ensure you have stable job to approve the refinancing. Some of bank will check at your office to see your history.
That’s some of basic idea you need to consider before make a refinancing. Don’t rush to do it even your friends succes with it. Some of us just don’t suit it.