consider getting a refinance on your current mortgage, but if you don’t know what category you fit into, you might find yourself making a very costly mistake.
If you can relate to any of these four real life situations, then you need to take the time to rethink mortgage refinancing for your situation. Read more http://www.mortgagebrokerco.com.au/
Avoid Mortgage Refinancing…
If the equity in your home has dropped.
If your home value drops, you will find that your overall equity that your home holds has dropped, as well. In this case, you shouldn’t consider mortgage refinancing, because you may find that you cannot get refinanced for the amount you currently owe on your home. If you can refinance up to 75% of your home’s new value, then you need to ensure that you currently owe less than that, or you might wind up paying more overall than you would if you kept your existing mortgage loan.
If your current home mortgage is almost paid off.
Consider this: you have been paying on your existing loan for 20 years. Good for you, you’re almost done. Now, consider that you are hitting some tough times, and it might be nice to reduce the number of your monthly mortgage payments. Consider that if you chose to refinance your existing mortgage at what you owe, you would be potentially tapping into your home’s valuable equity, and you could risk subjecting yourself to another 30 years of interest payments again. Instead, you should tough it out with your current payments for the next ten years because your home mortgage will be paid off before you know it. Click here to read more info about home mortgage.
If your home equity has been tapped, you should avoid mortgage refinancing.
Often, many people choose to refinance their homes so they can get much-needed cash out of their home equity, but if you do this every few years, you are only managing to rip yourself off in the long run. Instead, you need to make sure that you take the time to work seriously on repaying your home loan. Don’t keep refinancing your mortgage only to find that you don’t have enough equity this time. You may need the cash, but you will likely find that if you get a second job and work through your current dilemma, you’ll be glad that you chose to work on paying your mortgage instead of refinancing it.
If you are considering refinancing your home mortgage to get cash.
Often, when you decide to refinance your existing home mortgage, it might be to tap into the equity in your home so that you have more cash for anything you might need. This can be a dangerous and risky venture that you need to reconsider if you’re thinking of getting a home mortgage refinance. When you tap into your equity, you are paying interest and extending the life on your loan that you wouldn’t be paying otherwise. If this sounds like you, maybe you should consider other ways that you can make some extra money and keep your existing mortgage the way it is for now.
The bottom line is that in many cases, a mortgage refinance might be your best option, but sometimes, a refinance isn’t your best option. If you can relate to any of the above scenarios, then you should think long and hard about how long you want to be paying on your mortgage before you consider a mortgage refinance that can cost you many years and thousands of dollars in interest payments.