Refinance
Mortgage Refinancing is simply paying off an old or current mortgage with the proceeds of a new mortgage loan. Refinancing should not be confused with getting a second home loan such as a HELOC or HELOAN.
A mortgage refinance is normally done to lower the interest rate or term and/or take cash out. There are currently three types of refinancing that most mortgage lenders perform to refinance a borrower’s home. The most common mortgage refinance method is called the Refinance Cash Out. Most common cash out refinances are down to payoff other credit debts that have high interest rates. A Rate Term Refinance is when a borrower just wants to lower the interest rate or shorten the loan term. This home loan refinance is for those who are not looking to take cash out. A Streamline Refinance will require a borrower to have a FHA Loan or VA Loan to streamline it. The borrower will need to streamline from a FHA to FHA and/or a VA to VA. Conventional to VA/FHA or FHA to VA is not considered a Streamline Refinance
Reasons to Refinance
1. Lower mortgage payments
2. Remove mortgage insurance or Lower PMI
3. Remove a second mortgage, HELOC, or Home Equity Mortgage
4. Consolidate unsecure debts, auto loans, credit cards, etc
5. Invest in new real estate
6. Lower mortgage rates
7. Shorter Loan Term
8. Get into a Fixed Rate Mortgage
9. Home Improvements
10. Extra Money for liquidity
11. Invest in bonds, stocks, mutual funds, etc
12. Pay college tution or expenses
13. Pay medical expenses