Mortgage Refinancing for Dummies

Mortgage refinancing can help you in several ways. Refinancing can be a great tool in personal finance management, if done for the right reasons. People perform a mortgage refinance for several reasons, but below are the right reasons:

1. Lower Monthly Payment

First, start with GarvFinancial.com’s Mortgage Consolidation and Refinancing Calculator. The mortgage refinancing calculator can help you decide whether or not it would be prudent to refinance a single home loan or to consolidate the first and second mortgage into one mortgage loan. Also, the calculator computes the monthly payment, net interest savings (if applicable), and how many months it will take to break even including closing costs. Additional financial calculators are available that can aid you in making the decision to refinance. Refinancing your home loan mortgage can be solution in meeting your specific loan needs, such as:

• lower interest rate means more cash in your pocket every month
• enjoy more options with the extra cash flow money
• put more money towards savings
• pay off your high interest debts faster
• do home improvements, have your dream vacation or whatever you need
• gives you flexibility and choice in your finances

2. Simplify and Consolidate

It is easy to get into debt but hard to get out of it. Simplify your life and consolidate your debt into one easy mortgage payment:

• one simple monthly payment replaces figuring out your bills
• end the cycle of debt and pay off your revolving credit cards
• get rid of high interest debt with one easy refinance home loan
• commonly, mortgage interest is tax deductible, unlike credit card interest

3. Credit Score Has Improved

It is time to recoup the dividends of an improved credit score with a low rate refinance mortgage:

• enhanced credit score may get you a lower interest rate
• helps further improve your credit with on time refinance payments

5. Arrest Payments from Rising

Remove guess work from your adjustable-rate mortgage (ARM), convert to a lower fixed rate mortgage payments:

• fixed mortgage gives you back control of your finances
• helps improve cash flow
• provides security from rising interest rates

6. Leverage Cash (Entrepreneurs Only)

As a real estate investor, you are used to doing ARMs, interest only mortgages, and other unconventional home loan financing. Hopefully, this bursting of the housing market and economic downturn has taught you a valuable lesson – sure you get a lower payment with an exotic mortgage but at a high price. Refinance to a fixed rate mortgage and have protection from further financial insecurity due rising interest rates. You can still leverage with a low interest rate fixed home loan:

• extra cash for other investment opportunities
• ability to diversify your investment portfolio
• Increase your investment property value by using extra cash for improvements