Refinance Mortgage and Pay Off Your Loan
having a mortgage is a big headache sometimes, at the end of the month when you make your loan repayment you wish you think of all the things you could be spending the money on instead. Yet you know that if you don't make the payments you risk losing your house. Making mortgage payments every month is the only way you can own your dream home and have a large asset. There is a way to reduce the stress of carrying a mortgage and make life considerably easier. If you refinance your mortgage you can have some extra cash and repay your mortgage faster.
When Should You Refinance?
When you first bought your house you may have chosen to take out an adjustable rate mortgage. At the time you may not have known how long you were going to stay in your house or whether you could afford to make payments over a long period of time. The decision was probably the right one for you at the time. However if you find yourself living in the same place and will probably continue to do so for a while more then you should refinance your mortgage and switch to a fixed rate mortgage. A fixed mortgage rate assures you fixed payments every month and you are no longer at the mercy of fluctuating interest rates.
At the time that you took out your mortgage you didn't have as much financial stability and maybe didn't earn as much as you do now, your long repayment term reflects this. When you refinance your mortgage you can shorten the repayment term considerably. A thirty or forty year repayment period can be shortened to just ten or fifteen years. Shortening your repayment period will save you a significant amount of money in interest rates and you will be able to build up equity in your home if you maintain the same amount of repayment.
Deciding to refinance your mortgage could mean extra money in your wallet, enough to pay for a semester of college, take a holiday, treat yourself to something expensive. These possibilities open up when you choose to refinance for an amount higher than your principle balance. The money left over is cash that you can use. It sounds unbelievable but when you refinance your mortgage you can actually find yourself with more money than you are used to. Think about it carefully and if you choose to refinance your mortgage you will get to enjoy the benefits.
