Refinance Loan Basics: 5 Things to Consider
Refinancing your mortgage can be a smart financial move, especially if you can take advantage of lower interest rates. However, before you apply for a refinance loan, it’s essential to consider some critical factors to ensure you make an informed decision. Here are the important things you should consider:
Your Credit Score – Your credit score is a crucial factor in determining your eligibility for a refinance loan and the interest rates you’ll be offered. Check your credit score and make sure it’s in good shape before applying for a refinance loan.
Current Interest Rates – Before refinancing, it’s essential to compare the current interest rates to your existing loan to determine if a refinance will save you money in the long run. Several websites can provide you with current mortgage rates, such as Bankrate and Zillow.
Closing Costs – Refinancing your mortgage can come with closing costs, which can range from 2% to 5% of your loan amount. Before applying for a refinance loan, make sure you understand the closing costs and factor them into your decision-making process.
Loan Terms – Refinancing your mortgage means taking out a new loan with new terms, such as the length of the loan and the interest rate. Consider how the new loan terms will impact your monthly payments and the overall cost of the loan.
Refinancing Goals – Determine your goals for refinancing your mortgage, whether it’s to lower your monthly payments, shorten the loan term, or access equity in your home. Understanding your goals will help you choose the right refinance loan.
At langley, we offer some of the best mortgage rates in the industry. Our team of experienced mortgage professionals can help you navigate the refinancing process and find the right mortgage loan for your needs. Contact us today to learn more about our refinance loan options.