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Should you refinance your mortgage

Keroy King
November 07, 2014
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Should you refinance your mortgage

Should you refinance your mortgage

Keroy King

November 07, 2014
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  2. www.lifethenfinance.com Obtaining a mortgage with a lower interest rate or

    lower monthly payments can save you thousands of dollars over the course of the loan.
  3. www.lifethenfinance.com What is Refinancing Your Mortgage All About? •  Refinancing

    is paying off the loan you currently have and taking out a new mortgage loan. •  Your current loan gets paid off in the refinance when you close on the new loan. •  It`s usually easier to refinance than it is to acquire a mortgage loan in the first place.
  4. www.lifethenfinance.com What Does Equity Mean to You? Your equity is

    what gives you all kinds of choices in refinancing your home. Tip: Any time your equity is enough so that you’re financing less than 70% of your home’s value, it’s easier to find lenders that will compete for your business!
  5. www.lifethenfinance.com Paying off your current debts and then making your

    new mortgage payments on time will build some great credit!
  6. www.lifethenfinance.com Pros to Refinancing Your Mortgage •  You can lower

    your monthly payments. •  You can lower your interest rate. •  You can change from a variable interest rate mortgage to a fixed interest rate mortgage.
  7. www.lifethenfinance.com Pros to Refinancing Your Mortgage •  You can cash

    out your equity: o  Use the cash to pay off higher interest debts. o  Consolidating your debts in this way means one monthly payment instead of many. o  You can pay cash for a major purchase instead of taking out a higher interest loan.
  8. www.lifethenfinance.com Pros to Refinancing Your Mortgage •  You can raise

    your credit score. •  You can receive some nice income tax deductions…
  9. www.lifethenfinance.com Income Tax Deductions •  In the USA, if you

    itemize your deductions on Schedule A, you can deduct interest payments on your home`s mortgage from your income. •  Credit card interest, however, isn't tax deductible. Meaning…
  10. www.lifethenfinance.com Income Tax Deductions   By using your equity to

    pay off your credit cards and putting that debt into your home mortgage, you`ve lowered the interest you pay on your credit card debt while, at the same time, making it tax deductible!
  11. www.lifethenfinance.com Cons to Refinancing Your Mortgage •  You`re starting over

    on your mortgage, so it may take you longer to pay it off than if you had not refinanced. •  Your mortgage debt will be larger than before the refinancing, due to closing costs and if you take out some cash.
  12. www.lifethenfinance.com Cons to Refinancing Your Mortgage •  Your monthly payments

    may be larger than before if you cash out some equity in the refinance. •  With the new mortgage, you may be subject to early pay-off penalties if you wish to pay off a large portion in the near future.
  13. www.lifethenfinance.com Modifying Your Current Mortgage Loan •  If the value

    of your home has decreased, consider modifying your mortgage loan. •  You may be able to lower the interest rate, your monthly payments, or even the principal on the loan by modifying it. •  However, trying to get a loan modification can be challenging!
  14. www.lifethenfinance.com Modifying Your Current Mortgage Loan 1. Contact your lender to

    apply for a loan modification. 2. Keep in regular contact with them by phone and fax regarding the status of your loan modification request.
  15. www.lifethenfinance.com Modifying Your Current Mortgage Loan •  Contact the department

    heads for the various departments you work with as your application progresses. •  Send faxes to the specific departments requesting regular updates. •  Record your phone calls, if possible. •  Write down the name of anyone you speak with, the date, and a summary of each conversation.
  16. www.lifethenfinance.com Modifying Your Current Mortgage Loan •  Utilize the internet

    for information on working with your lender! Tip: With good communication and knowledge of how to help the process go smoothly, your loan modification can be a success!
  17. www.lifethenfinance.com Self-Reflection Questions: •  Do I have a fixed or

    adjustable rate mortgage? •  Is the refinanced rate low enough to justify the switch? •  How much equity do I have in my home? •  How long will it take me to lpay offz the costs of refinancing and begin realizing my savings?
  18. www.lifethenfinance.com Self-Reflection Questions: •  Do I plan on staying in

    this house for a long time or will I be moving in the future? •  Am I looking for lower interest, lower payments, or to cash out my equity? •  If I cash out my equity to pay off other debts, do I have the discipline to stay out of debt once my current debts are paid? What will I do with my credit cards?
  19. www.lifethenfinance.com Action Tips: •  Research the terms of your loan

    to see if it`s worth shaking up the status quo. •  Estimate your home`s current value and determine if you have enough equity to give you some advantages in refinancing.
  20. www.lifethenfinance.com Action Tips: •  If you`re considering refinancing your mortgage,

    meet with a reputable mortgage broker to discuss your situation. •  After meeting with the mortgage broker, write down the pros and cons of refinancing your mortgage. This will help you make an informed decision to refinance or not.
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