When it comes to owning a house, financial matters can often be the most confusing aspect of it. You may have heard of home refinancing but not know much about it. If you are looking for a way to lower your monthly mortgage payment, make sure you know the answer to these 3 questions.
Will Refinancing Save You Money?
When refinance your house, you are basically getting a brand new loan which is used to pay your previous loan. While it may seem counter-intuitive, it can actually save money since you can get a lower interest rate.
Meet with a mortgage lender to find out how refinancing can help save you money, or at least lower your monthly mortgage payment. For example, if you plan on selling your home in the near future because you are downsizing, it may be beneficial to refinance and take advantage of a lower interest rate for that short period of time. It can help make your mortgage affordable.
Will The Refinance Automatically Be Approved?
A misconception you may have about home refinancing is that it will be automatically approved since you are an existing homeowner. This isn't always the case, since refinancing involves applying for a brand new home loan. If there were drastic changes in your credit score, personal income, and debts that you have incurred over the years, all of that will be taken into consideration when refinancing.
You might have to take some time to fix any blemishes in your credit history before you begin the refinancing process. It can delay the process, but you will find that you'll have a better chance of the loan being approved with the lower interest rate that is being offered.
Can You Go To A New Lender For Refinancing?
You can go to a new mortgage lender for your refinancing or go to your existing lender. It's possible that your existing lender may have an easier time processing your loan, since they have access to things such as the original appraisal and additional documents related to the house. That said, it's always worth it to shop around to find the best interest rate possible if that is your reason for refinancing.
Now that you know more about refinancing, you will be prepared for what to expect when you meet with a mortgage lender. They can fill you in on more specifics related to the loan on your home and if it will be financially viable to refinance with a lower interest rate. Contact a company like Doolin Security Savings Bank for more information.Share