Refinancing a mortgage is when you take out a new mortgage to pay off an existing mortgage. Typically, in order to do that, there must be a tangible net benefit that is demonstrated. Examples would be:
- More favorable terms
- Convert an adjustable rate loan to a fixed rate loan
- Lower your interest rate
- Shorten your repayment term
- Debt consolidation
- Combining a first and second
- Payoff other high interest debt lowering overall monthly obligations
- Home Improvements
- Or you might want cash out
Qualifying for a refinance differs based on whether there is increased risk on the loan, such as a higher loan amount or monthly payment. However, on some loan types if the purpose of the refinance is to lower your interest rate or shorten the term of your loan, you might qualify for a streamlined refinance process.
Not sure if a refinance is right for you? There is actually a break even analysis The LifetimeLender Team can walk you through to determine if a refinance makes sense.
*By refinancing your existing loan, your total finance charges may be higher over the life of the loan.
**VA loans subject to individual VA Entitlement amounts and eligibility, qualifying factors such as income and credit standards, and property limits. Fairway is not affiliated with any government agencies. These materials are not from VA, HUD or FHA, and were not approved by VA, HUD or FHA, or any other government agency.
