Home Mortgage Refinancing:
When Not to Refinance
While you may be contemplating
home mortgage refinancing, you need to understand that
there actually are some instances in which you should
not obtain home mortgage refinancing. In this article,
you are provided an analysis as to when home mortgage
refinancing is not the best option for you.
The Bombarment of Advertising Regarding
Home Mortgage Refinancing
People who listen
to the radio, watch television, read the paper, use
the internet, or even open their mail are inundated
with offers to refinance, each company claiming to offer
the best deals and services around. They will say you
can pay off some of your high interest debt, have money
for college tuition, or even take money out of your
house for that dream vacation.
is not something everyone should do, and if you do it,
you should do a great deal of homework before you ever
sign those papers. There are many circumstances where
refinancing isnít the right thing.
Are You Planning on Moving Soon?
Refinancing is always
a tasty sounding morsel when interest rates are low,
but not everyone should do it. If you are not planning
on being in the house long, you are one of the people
for whom it would not make sense. Also, if youíve already
paid down a lot of your debt, you are too late to refinance.
In fact, your costs may increase, even with the lower
Credit Problems and Home Mortgage
If your credit has
taken even a small dive, beware of refinancing. Besides
not qualifying for a good interest rate, you may be
preyed upon by unscrupulous lenders who will try to
take advantage of your desire to clean up your credit.
Donít be fooled by themótime and hard work are the only
things that can clean up your reputation. There is no
Home Mortgage Refinancing and an Equity
Loan or Second Mortgage
If you have already
borrowed against your home, such as a home equity loan
or second mortgage, refinancing likely will not do anything
for you. If you need cash, try other means of getting
it. If you are looking for lower monthly payments, you
may have to cut out a few unnecessary expenses elsewhere
in your life and pay down your principal amounts.
Debt Consoliation Home Morgage Refinancing:
Is It Really Right for You
Using a refinance
to pay down credit cards and other debts seems to be
fashionable these days, but remember that it can have
disastrous consequences for the homeowner. This can
end up costing you more in the long run because youíre
spreading out your high interest debt over a long term
low interest payment plan. While it may lower your payments
or eliminate them, remember that you will be paying
for this money for perhaps another 20 years. Calculate
the interest over that time, and youíll realize that
youíve put your home on the line for a higher overall
interest payment even though the rate is lower.