When you refinance your mortgage, you are essentially paying off an existing loan and replacing it with a new one. There are many reasons why individuals refinance, such as the opportunity to obtain a lower interest rate, the chance to shorten the term of their current mortgage, the desire to convert from an adjustable-rate mortgage to a fixed-rate mortgage, the opportunity to cash out your home’s equity in order to finance a large purchase, and to consolidate debt.
There are Pros and Cons to all of the above reasons. Refinancing can cost 3% to 6% of the loan’s principal and requires appraisal, title search and application fees, as the original mortgage did. It is important for a homeowner to determine whether his/her reason for refinancing is truly beneficial.
Is refinacing right for you? Contact me today to find out! Your Burbank mortgage lender.