12 October 2017

Home Refinancing Loans - 3 Things To Know Before You Refi Your House

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Home Refinancing Loans - 3 Things To Know Before You Refi Your House

Maybe the current interest rate on your mortgage is higher than average, or perhaps you're just looking for a way to lower monthly payments. Whatever your reason for refinancing your Home Loan, there are a few things you should know before you commit to a refinancing mortgage:

You Should Compare Fees.

Like any other mortgage, you'll have to pay fees, closing costs, and possibly points and other extras whenever you refinance your Home Loan. In many cases, this can add thousands more to your bottom-line costs. Although you can sometimes add these costs to your loan amount, you still have to pay them in the end. To ensure you're getting a good deal, check on the final total of all additional fees when comparing lenders.

You Should Pick The Right Loan Term.

If you've already paid off quite a few years of your mortgage, and you finance for another 30-year (or longer!) loan, you may end up paying more interest in the end, depending your current interest rate and the one you receive when you refinance. If you're looking for the best savings, you should refinance your home for a lower interest rate with a loan term that is equal to or less than the amount of time left on your current mortgage. If, for example, you only have 15 years left on your current mortgage, it's smartest to choose a refinance loan with a 15-year term.

You Should Lock-In The Rate.

Just as you can with any mortgage, it's possible to "lock-in" your rate when you agree to work with a particular lender. That means your lender guarantees, in writing, that your interest rate will never rise above a certain amount within a set period of time, typically 30 or 60 days. These days, interest rates are on the rise, which means each week--or even each day--could mean a higher rate, so it's smart to lock in the lowest rate possible as soon as you can.

To get the best deal on a Home Loan Refinancing, remember to compare fees, choose the best loan term and lock-in the lowest rate. Follow these tips, and odds are good that you'll walk away with a money-saving loan.
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