Take Your Own Time And Consider All Home Refinancing Options

by David Jenyns on September 22, 2011

A homeowner must use a refinance mortgage calculator to determine whether he can really reduce monthly mortgage payments before opting for one.† Using simple user interface, a borrower can enter certain information into the mortgage refinance calculator like:

  • Mortgage amounts
  • Period of mortgage
  • Interest rates
  • Origination fees
  • Closing cost
  • Tax amounts

This king of advanced refinance calculators are used by mortgage companies and are also available free of cost on the websites.

{Mortgage companies use these kind of advanced refinance calculators and are available free of cost on their websites.}

The mortgage calculator you use for refinance calculations can be linked to other calculators that deal exclusively with specific calculations like:

  • Interest rates
  • Mortgage lengths
  • Tax benefits

A user can gather as much information as he can on changes in mortgage if he goes in for a home refinance.† Only if the final result is beneficial to him does he need to go ahead and apply for refinancing.† Hence, do not hesitate to use a mortgage refinance calculator and get the best deal you can.

There are so many reasons why a person will opt for home refinance. Some may go for home refinance to pay off existing debts. For some other, the reason may be to get extra money that can be used to invest in a new business venture or even to get tax deductions.† One must be very clear about these reasons in order to get a good deal. A home is a priceless commodity and the all these reasons to apply for home refinance are all flimsy.†

Getting a new loan to pay off an existing one could prove to be disaster. Refinancing your home to Invest money in a business can cause you to lose your home if venture fails.† The benefit that you get on tax deductions is not so great that you need to go for a new mortgage.† Many lending institutions will offer seemingly attractive packages on home refinance options.† Donít be fooled by these, you will be a scapegoat. Opt for home refinance if and only you have solid and valid reasons to go for it. Getting a new loan to clear off an existing one could leave you in more trouble. Refinancing your home for business investment can cause you to lose your home if venture fails. The benefit that you get on tax deductions is not so great that you need to go for a new mortgage.† Many lending institutions lure you with seemingly attractive packages on home refinance options.† Donít get in to all these, otherwise you will end up in a debt trap. Opt for home refinance if and only you badly need so additional cash flow.

If you wish to expand your business which is running successfully and if the market is healthy, you can opt for home refinance for the purpose. If you need more money to complete your studies which can get you a better job, then you can go for home refinance as it will help your cause. Both these are valid reasons to spend on and help you grow financially. But donít opt for home refinance just for the sake of doing it. After all, this is a new loan that needs to paid back.

If you donít have increased cash flow and have taken a new mortgage that is added burden to you, then your current lifestyle will change drastically.† Yet, home refinance is a good option for the right and valid reasons and in the right settings. It can improve cash flow with lesser monthly mortgage payments that will result in long term savings that can be used to pay off the first mortgage.† You must make sure that the new interest rates are lesser than what you are already paying. Read the loan terms and conditions carefully and make sure that there are no hidden costs.

If a homeowner has a $100,000, 30-year mortgage at 8% rate of interest, he can consider opting for home refinance if the interest rate fell to 6%.† This could help him save around $134 per month and an overall savings of over $48,000.† Hence, it is very important† to calculate the costs involved with a home refinance as against long term savings and how long the homeowner plans to continue in the same house.

The type of mortgage you get also depends on how long you plan to stay in the same house.† If you are considering remaining there for more than 10 years, then go with the fixed rate mortgage.† If on the other hand, you plan to sell after 5 years, you can consider the adjustable rate mortgage.† Consult a refinance professional who will offer many good insights into the whole subject so that you do not make a mistake.

Article by John Hoots of ChicagoMortgageSpecialist. For more information on realty mortgage Chicago, visit his site today.†

Previous post:

Next post: