Refinancing your home is a big decision. There are so many things to consider! Luckily, we’ve prepared this blog post for you, with seven secrets to successful refinancing tips and tricks that will help cut your interest rate.
Secrets of Refinancing
1) Shop around – Refinancing providers offer different rates and terms. The more you compare, the better chance you have of finding the best deal out there. Check out www.keycitylending.com for the best deals.
2) Get pre-approved before shopping – If you’re not already pre-approved for financing (and even if you are), it’s important to do some research ahead of time in order to get an idea of what type of mortgage refinance loan might be right for you. This way, when it comes time to start making offers, you’ll be ready to go.
3) Know what you can afford – When refinancing a mortgage, it’s important to know how much your monthly payments will be. Use an online calculator or speak with a financial professional to determine if the new terms are feasible for your budget.
4) Don’t underestimate closing costs – When you refinance, there are a lot of fees involved. Be sure to factor in the price of points and other expenses when negotiating your offer so that you can find an overall plan that works for you financially.
5) Be aware of hidden costs – There are some additional fees you need to be conscious of when refinancing. For example, some lenders charge an origination fee, appraisal fee, or other miscellaneous charges that affect your final interest rate and monthly payments.
6) Get the right loan type – It’s important to make sure you get a fixed-rate refinance instead of an adjustable-rate mortgage (ARM).
7) Refinance to a shorter term – If you’re able, consider refinancing your loan with the shortest possible mortgage term. This will lower your interest rate and the monthly payment (to an extent).
Refinancing is a big decision with lots of things to consider! However, the above tips should help guide you to a successful refinancing experience. Good luck!
The Bottom Line
Know your monthly payments and how much the new terms will affect them. When refinancing a home, there are a lot of fees involved, so factor those costs into all negotiations as well. Additional fees need consideration, such as origination or appraisal fees from lenders, which can financially affect your final interest rate and overall plan. Be sure to read all fine print – different lenders have hidden cost differences too!