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Thursday, September 15, 2011

Home mortgage refinancing is not always a good idea

The mortgage refinancing means that a borrower is a new loan and removed the old pay. The goal is, wait get benefits. Most people are after the lower monthly payments in the form of lower interest rates. But why the mortgage refinancing is not always a smart idea?


(1) The recession dropped the value of your property.


Estimated value of the House is usually the guarantee for the loan. Now mortgages if the home want to refinance, you can it happen that estimate has fallen. Usually the estimate to refinance, you can use 80% but it can happen that the current loan is more than that and you can the old loan numbers with the new loan.


The right solution is to wait, because during the run time long home prices always increased. Already home prices bring wait a few years to a level it makes sense to refinance the loan.


2. If you have paid almost off the old loans.


You can win everything, if you have paid almost off the old loans. Let's say you, that you a 30-year mortgage, and you have paid, that in 29 years, it is not advisable to refinance the loan, since the time when you can enjoy the benefits is simply too short, but still have the costs of the proceedings.


3. If you have a second loan.


If you have tried, just your financial burden by a second mortgage or a home equity loans and free equity, it is not advisable to try the mortgage refinancing. It works best if you sufficient equity and you have at home life and you for years for many years to pay the new loan.


4. Do have to pay only a few years.


The starting point of the mortgage refinancing is, it is a long-term commitment. If the refinancing costs, includes the future benefits gradually these costs. This simply means that the loan long you keep enough and have not adequately only a few years to pay, that is refinancing you.


5. Do you want only a small monthly savings.


If you haven't heard the news or gossip about the great savings by the mortgages to refinance and the same benefits are too excited, get, maybe you have it, nor even think through. Their need for extra cash is small, which will have to solve mortgage refinancing, not properly.


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