Refinance Basics

In many ways, your house is like a savings account.  If you have discipline and knowledge regarding the benefits of refinancing, you can tap into its equity for years to come.  There are many reasons you might want to refinance and most people fit into one (or more) of the basic categories.
Convert an Adjustable Rate to a Fixed Rate
Adjustable rate loans typically offer a lower interest rate than fixed rate loans because they shift the interest rate risk from the lender to the borrower.  Interest rate risk can be quite substantial and should not be underestimated.  In the 1980’s interest rates on mortgages were over 10% and it was not uncommon to have a 13 or 15% rate.  In 1981 the 30 year fixed rate mortgage rate ranged between 15% and 20%.  Basically, when rates are historically low it is best to lock in a low fixed rate for the term of the loan.
Consolidate Debts to Save Money and Cash Flow
Adjustable rate loans typically offer a lower interest rate than fixed rate loans because they shift the interest rate risk from the lender to the borrower.  Interest rate risk can be quite substantial and should not be underestimated.  In the 1980’s interest rates on mortgages were over 10% and it was not uncommon to have a 13 or 15% rate.  In 1981 the 30 year fixed rate mortgage rate ranged between 15% and 20%.  Basically, when rates are historically low it is best to lock in a low fixed rate for the term of the loan.
Get Cash Out for Home Improvements
Adjustable rate loans typically offer a lower interest rate than fixed rate loans because they shift the interest rate risk from the lender to the borrower.  Interest rate risk can be quite substantial and should not be underestimated.  In the 1980’s interest rates on mortgages were over 10% and it was not uncommon to have a 13 or 15% rate.  In 1981 the 30 year fixed rate mortgage rate ranged between 15% and 20%.  Basically, when rates are historically low it is best to lock in a low fixed rate for the term of the loan.
Lower Monthly Payments
Adjustable rate loans typically offer a lower interest rate than fixed rate loans because they shift the interest rate risk from the lender to the borrower.  Interest rate risk can be quite substantial and should not be underestimated.  In the 1980’s interest rates on mortgages were over 10% and it was not uncommon to have a 13 or 15% rate.  In 1981 the 30 year fixed rate mortgage rate ranged between 15% and 20%.  Basically, when rates are historically low it is best to lock in a low fixed rate for the term of the loan.
Lower Interest Rate to save Money
Adjustable rate loans typically offer a lower interest rate than fixed rate loans because they shift the interest rate risk from the lender to the borrower.  Interest rate risk can be quite substantial and should not be underestimated.  In the 1980’s interest rates on mortgages were over 10% and it was not uncommon to have a 13 or 15% rate.  In 1981 the 30 year fixed rate mortgage rate ranged between 15% and 20%.  Basically, when rates are historically low it is best to lock in a low fixed rate for the term of the loan.
Shorter Term and Lower Interest Rate to Save Money
Adjustable rate loans typically offer a lower interest rate than fixed rate loans because they shift the interest rate risk from the lender to the borrower.  Interest rate risk can be quite substantial and should not be underestimated.  In the 1980’s interest rates on mortgages were over 10% and it was not uncommon to have a 13 or 15% rate.  In 1981 the 30 year fixed rate mortgage rate ranged between 15% and 20%.  Basically, when rates are historically low it is best to lock in a low fixed rate for the term of the loan.

Refinance Basic Steps

Mortgage Pre- Approval

Mortgage Application

Appraisal

Underwriting

Closing