Rate This:Ask This About Refinancing Your Mortgage
Refinancing your mortgage may be a wise step to ensure your financial security. If you have been considering refinancing your mortgage, now may be the time to do it. With rumors swirling about the Federal Reserve increasing interest rates in the future, refinancing your mortgage is a great way to take advantage of the current low interest rates. On average most homeowners with a 30-year fixed rate mortgage will refinance their mortgage in about 7 years. If this may be the case for you, waiting much longer could force you to pay a lot more, leaving you with a lot less. If you are considering refinancing your mortgage, ask these questions about one of the most important financial decisions you’ll ever make.8 Active Questions | Add a QuestionRefinancing a mortgage is generally thought to cost around 3% to 6% of the loan amount. This is what lenders usually tell borrowers at the time of the loan. While at first the refinance may cost borrowers, in time the savings will outweigh that cost.If you are facing plenty of years left on your mortgage, it may be time to consider refinancing your mortgage now, before interest rates get too high. If you are nearing the end of your mortgage, it may not be necessary to refinance at this point.While treasury bonds do not directly affect interest rates, there is often a high correlation between the price of bonds and interest rates. As bond prices fall, interest rates are likely to rise and as bond prices rise, interest rates are likely to lower.The Federal Reserve administers short-term interest rates, which in turn determines longer-term interest rates as determined by the market. By taking advantage of the lower interest rates, you can enjoy a fixed-rate refinance before the Federal Reserve raises interest rates again.Adjustable-rate mortgages can change on a monthly basis, bi-annually or annually. If you currently have an adjustable rate mortgage, you could be facing higher rate interest rates as bond prices fall and the Federal Reserve raises interest rates.Merely having a mortgage will not qualify you for refinancing. In order to refinance you will need to have a good credit score. To ensure you have a good credit score, pay all your mortgage payments and other payments on time.If you are going to be moving in the near future, that is to say about 2 or 3 years from now, it may not be worth the cost and time it takes to refinance your home. However, if you plan to stay for at least 5 or more years, then you may see plenty of benefit when it comest to refinancing.