Refinancing your mortgage can be a smart financial decision that will likely save you money long term. Don’t let common misconceptions like these hold you back from consolidating your debt.
You must reset your loan term.
Refinancing simply replaces your current loan with a new loan. This doesn't mean you have to reset the terms of your loan altogether.
Not enough time has passed since your last refinance.
You can be eligible to refinance as soon as 6 months after your previous refinance! However, it's always important to consider your financial goals when choosing if it is the right time for you to refinance.
You need 20% equity to refinance your home.
Some loans may require mortgage insurance if you have less than 20% equity in your home, but this does not affect your ability to refinance at all. Even with the additional cost of mortgage insurance, refinancing can save you money in the long run.
Your current lender can offer you the best rates.
Your lender might persuade you that sticking with them will get you the best deal, but this may not be the case. It is always better to shop around and compare all the possibilities out there before making a decision. We have relationships with over 30 lenders making sure that we find the best loans for your needs.
Refinancing is all about getting a lower rate.
Getting a lower rate isn't always the only thing to think about when refinancing.
While it is important, there are so many other reasons why you could refinance. Perhaps you would like to take out cash to renovate your home or consolidate other high-interest debts. You can also get a shorter loan term to pay off your mortgage sooner and save on interest!
You need cash to cover closing costs.
While refinancing includes closing costs similar to when you initially get a mortgage, there are ways to get around them if necessary. You can sometimes lower, if not get rid of your closing cost altogether, in exchange for a slightly higher rate.
If you’re thinking about refinancing and are unsure if now is the right time, give us a call today to talk about your financial goals!