When Is it Time To Refinance??
Have you had a Mortgage for 2 years or longer? Looking to consolidate all your loans? Is it time to renovate? Thinking that you’re paying too much interest? These are some of the common situations that motivate people to look at their home loan options.
What is refinancing?
In a nutshell – refinancing your home loan means changing your home loan from one lender to another – the most common reason is usually to obtain a better to obtain a lower interest rate.
You can refinance with the same provider, which is known as internal refinancing, however, if you’re staying with the same lender and just chasing a better interest rate, then requesting a discount is usually the better solution.
Why would you refinance?
Simply because as times change – so do product features, interest rates as well as your personal needs and objectives.
A common need to refinance is to renovate, release equity in your property to fund various activities as well as obtain a better deal or a more appropriate loan structure. Most finance professionals recommend reviewing your loans at least every 2 years. When looking to refinance some of the important considerations include the costs of discharging your existing mortgage as well as difficulty in changing lenders. The facilities that the new loan can offer is also an important consideration.
What is the refinancing trap?
The biggest refinancing trap is to be too focused on your weekly repayment obligations and not focus on the long-term picture. When people refinance they generally choose the maximum loan term of 25 – 30 years. If you opt to extend the term of the loan, it is best to make additional repayments. Alternatively, if you’ve been paying higher repayments with your current provider based on a higher interest rate then continuing those repayments wherever possible is a good choice to make.
In Conclusion
Review your mortgage every 2 years and when it is time to refinance, Miller Finance is ready to help. We make the process as smooth as possible, generally, it takes about four weeks from start to finish to refinance – we’ll be with you the whole way. Book an appointment today.
