To Refinance Or Not: How To Determine The Right Answer

If you have a mortgage that you acquired back when you had less than stellar credit, there is a good chance that you might now qualify for a better loan. If you have spent the last few years working on your credit and now have a much higher credit score, you would definitely qualify for a better interest rate, but does a lower interest rate alone mean that you should go ahead and refinance? Well, here are several things you should consider as you determine whether to refinance or not.

Your future plans for this home

One good factor to consider in this decision is your future plans for this home. Are you planning on moving to a different house at any point in the future? If so, how long do you plan on living in this house? If you are going to refinance your loan, you should make sure that you plan on living in the house for at least the next five years. If you are considering moving before this, paying all of the closing costs and fees for the refinancing would not be worth the money. If you want to stay in this house for a while, then refinancing might be a good option.

The amount of equity you have in the house

A second thing to consider is the amount of equity you have in the house. If you purchased the house with no money down, you might not have a lot of equity in the house. If this is the case, you might not qualify for a conventional loan, unless you are able to put some money down on the loan. If you cannot qualify for a conventional loan, you might end up with the same type of loan program you currently have, and there can be extra fees you must pay with other types of loan packages. If you have at least 20% equity in the home, refinancing might be a good idea.

The difference from the current interest rate to the new one

The other factor you should evaluate is the difference in the two interest rates. If refinancing would only drop your interest rate a very small percentage, it might not be worth paying the fees to go through with it.

If you think that refinancing would be a good option right now, talk to a real estate agent or a refinancing service like Tennessee Home Mortgage. 



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Listing Your Home For Sale Are you thinking about listing your home for sale? Although it might not seem like a pressing priority, being able to list your home when you want to can really help you to stay financially liquid in a slow market. However, you have to know the tricks of the trade if you want to prevent problems in the long run. I began carefully thinking about different ways to improve my sales tactics, and it was really cool to see how many of the ideas we had helped. This blog is all about listing your home for sale and preventing issues in the long run.

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