6 Refinance Questions to Ask Yourselves

By: Fainting Goat-Madison's Website design company
 
MADISON, Wis. - May 16, 2014 - PRLog -- RIS Media, Today's eNews, by Michele Lerner, March 20, 2014
Before opting to refinance, homeowners should ask themselves the following six questions.

1. Do I have equity in my home? Homeowners need to have at least 20 percent equity in their home to qualify for a new loan without paying private mortgage insurance.
2. Do I have good enough credit? Borrowers' credit scores play a big role in securing a good mortgage rate and to qualify for any type of mortgage at all.
3. What are my financial goals? Make sure to integrate paying off your mortgage with your overall financial plan.
4. How long do I plan to stay in this home? Mortgage professionals generally tell borrowers to expect a home refinance to cost 3 percent to 6 percent of the loan amount. If the breakeven point (when the savings outweigh the costs) is at 15 months and you plan to stay in the home for five years or longer, it is probably worth it to refinance. But if you plan to move in two years, it may not make sense.
5. What are the terms of my current loan? Borrowers with adjustable-rate mortgages or interest-only loans should consider the potential benefit of switching to a fixed-rate loan.
6. Do I have a second mortgage or line of credit? Borrowers with a second mortgage will face additional complexity when refinancing. Borrowers can either pay off the second loan or combine the two loans with a larger first mortgage.

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Source:Fainting Goat-Madison's Website design company
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Tags:Home Financing, Home Buying, Home Selling, Mortgages, southern Wisconsin homes
Industry:Real Estate
Location:Madison - Wisconsin - United States
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