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Knowledge base on
no fee mortgage refinance
Why should you refinance?
Refinancing has become a valid option for many individuals with high interest rates on their mortgage. Refinancing is essentially a replacement loan, with a different lender and (hopefully) a lower interest rate.
So why would you choose to refinance?
- You may be able to take advantage of lower interest rates.
- You may also be able to extend the repayment period of your mortgage. While you will end up paying more in interest charges for this, this will reduce your monthly outgoings.
- You may be able to switch from a variable rate to a fixed rate mortgage, giving you greater security in the future from potential rate increases.
- You may also be able to increase the amount of your mortgage, to pay off other, higher interest rate liabilities such as credit card debt, cell phone debt and personal loan debt. This will enable you to save money on interest rate charges
Why would you avoid refinance?
If you decide to borrow more than your existing mortgage, you need to be wary of your budget. If you default on your payments you run the risk of losing your house.
If you do not calculate the costs involved with refinancing correctly, you could end up paying more in interest charges.
Thoroughly review the contract of your existing loan, an early pay out could involve a penalty that would negate the benefits of refinancing.
What will it cost me?
Refinancing does carry some costs that you need to be made aware.
Valuation Fee This is the fee for a professional appraisal of the value of your house.
Credit Report An assessment of your credit health
Escrow Fee for money transferred by a third party.
Lender Fees Any other fees that are incurred by using a particular lender
Am I eligible?
Applying for mortgage refinance is just like applying for another loan. There is a set criteria for acceptance. Every missed mortgage payment will count against you in the application, either resulting in a greater interest rate or a refused application.
Should I choose refinancing?
You will need to assess your current mortgage and the changeover costs and savings to ascertain whether it will be of benefit to you. There are specific refinancing calculators that can help you determine the net gain. The best one that I have found is at calcbuilder.com.
As a rule of thumb many lenders advocate that a 1% gap between your current interest rate and a refinance rate makes refinance a worthwhile option.
Always make sure to speak to a financial professional before deciding to refinance your mortgage.
About the author:
More mortgage refinance information available at http://members.optusnet.com.au/~mortgagearticles/
More Useful Resource and Updates on no fee mortgage refinance
- US mortgage applications slump to 8-yr low (The Economic Times)
US mortgage application demand skidded last week to an eight-year low, driven by a nearly 30 per cent slump in demand to refinance home loans as borrowing costs rose.
- Mortgage applications fell 20.3% last week: MBA (Market Watch)
Mortgage applications filed last week fall a seasonally adjusted 20.3% compared with the previous week, as rates on fixed-rate mortgages increase, the Mortgage Bankers Association reports on Wednesday.
- Mortgage aid program gets little attention (The News Journal)
WASHINGTON -- The government expects only 20,000 troubled borrowers will apply to refinance into more affordable home loans by next fall under a new mortgage aid program passed over the summer.
- Response slow to mortgage swap program (The Kansas City Star)
WASHINGTON | The government expects only 20,000 troubled borrowers to apply to refinance into more affordable home loans by next fall under a mortgage aid program approved over the summer.
- Low hopes for new mortgage program (Standard-Examiner)
WASHINGTON -- The government expects only 20,000 troubled borrowers will apply to refinance into more affordable home loans by next fall under a new mortgage aid program passed by lawmakers over the summer.
- Mortgage aid idea falling short (The Scranton Times-Tribune)
ASSOCIATED PRESS WASHINGTON ? The government expects only 20,000 troubled borrowers will be able to refinance into more affordable home loans by next fall under a new mortgage aid program passed by lawmakers over the summer.
- (AFX UK Focus) 2008-11-05 12:15 US mortgage applications slump, costs increase-MBA (Interactive Investor)
NEW YORK, Nov 5 (Reuters) - U.S. mortgage application demand skidded last week, driven by a nearly 30 percent slump in demand to refinance home loans as borrowing costs rose, a trade group said on Wednesday. The Mortgage Bankers Association's seasonally adjusted mortgage applications index, which includes both purchase and refinance loans, slid 20.3 percent to 379.9 in the week ended Oct. 31. ...
- U.S. home-loan applications fall 20.3% (Providence Business News)
APPLICATIONS TO REFINANCE fell 27.8% last week, to 42.9% of applications, as interest rates on fixed-rate loans crept skyward, the MBA found.
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