Mark Tiernan, Refinancing Your Mortgage Can Open Up A Lot Of Options For You And Your Family<br><br><br><br><p>It can happen to anyone, the roof is leaking, the credit card bills
are pilling up and it is almost time for a new car. But where are you
going to get the money to do all of these things? The need for extra
cash can be very frustrating and worrisome, however if you are a home
owner you have a variety of financial options available to you that you
may not even be aware of. You should look into refinancing as a viable
option to solve your financial worries.</p><p>Refinancing your mortgage
can give you a lot of options as far as the freedom of a little bit
extra cash. There are a few different ways that you can go about
refinancing and the best way for you depends on what you are hoping to
accomplish and what your own personal situation is.</p><p><b>What Is My Current Situation?</b></p><p>The
first thing that you need to look at is what your current situation is.
You need to do a little background research into your own situation.
Many home owners do not know what they are paying for an interest rate
or in some cases, home owners do not know the term of their mortgage or
any of the details.</p><p>It is important to know what your interest
rate is currently, because if you are going to refinance you may be
trading your already low interest rate for a higher one, which is not
likely to be in your favor. It is a good idea to know what your
situation is presently before you try to refinance.</p><p><b>Why Should I Refinance?</b></p><p>There are a few reasons for refinancing a mortgage:</p><p>* To lower monthly payments<br>
* To shorten the length of the mortgage<br>
* To take advantage of low interest rates<br>
* To finance a home project or renovation<br>
* To consolidate bills<br>
* Reduce Risk</p><p><b>How Will A Lower Interest Rate Affect Me?</b></p><p>One
of the most common reasons that people go through the refinancing
process is to take advantage of low interest rates in the marketplace.
The interest rate that you pay on your mortgage makes an incredible
difference to your monthly payments. If you have an interest rate on
your mortgage that is quite a few points higher than the current market
interest rate, you are likely to be paying much larger monthly payments
than you need to be.</p><p><b>For Example:</b><br>
House cost $200,000<br>
Down Payment 40%<br>
30 year repayment<br>
Interest rate 5%<br>
Monthly payments - $859</p><p><b>But, if your interest rate is only 3%</b><br>
House cost $200,000<br>
Down Payment 40%<br>
30 year repayment<br>
Interest rate 3%<br>
Monthly payments - $675</p><p>As
you can see, only 2% makes a huge difference in your monthly payments.
An excellent reason to refinance your mortgage would be to take
advantage of a lower interest rate and lower your monthly payments.</p><p><b>I Could Use Some Extra Cash!</b></p><p>Does
your house need a new roof? Maybe it is finally time to develop the
basement or to finally put on that much needed addition. Almost all
homeowners at one time or another could use some extra cash. You can
refinance your home mortgage to get your self some extra money to do
the things that you need to do around your house.</p><p>Often it makes
financial sense to refinance your mortgage to include the cost of the
new roof or whatever it is that you need extra money for. If you can
refinance at a low interest rate, then you can add the amount that you
need to borrow into your mortgage and perhaps make slightly higher
payments or extend the length of your mortgage term to offset the
difference.</p><p><b>What About My Credit Card Bills?</b></p><p>Maybe
you do not need the extra money for home improvements but you have some
major credit card bills. If you have credit card bills piling up than
refinancing your mortgage is an option that could save you hundreds or
thousands of dollars in payments every month. You can refinance your
mortgage to include your credit card bills. People usually do this
because the interest rate that you pay on your mortgage is generally
lower than the interest rate of most credit cards. Before you decide to
rework your mortgage to work in your credit card bills, you will want
to look at how it will affect the overall picture. Will this extend
your payout period a few years? What will your monthly payments be?
These are a few questions that you will want to ask yourself and your
banker before making the change.</p><p><b>What If I Want To Pay Off My Mortgage Faster?</b></p><p>Many
people may find themselves in a situation where their circumstances
have changed since purchasing their home. Maybe you are making more
money now than you were when you bought your home and now you would
like to payoff your mortgage faster. You can refinance your mortgage to
make it a shorter payout period if you are in this situation. However,
you may want to just consider increasing your payments voluntarily or
make balloon payments on your mortgage instead of refinancing. This is
advisable as a security net just in case you lose your job or the
situation changes you will not find yourself in a bind. However, some
people need to have it official in order to make the payments.</p><p>There
are many different reasons for refinancing your mortgage, and everyone
will have their own personal factors that help them make their
decision. The important thing to remember is to know all of the facts
before making your decision and make the best choice for you and your
family.<br>
© 2005 <a href="http://www.home-loans-101.com">http://www.home-loans-101.com</a></p><p><b>About the Author</b><br>
Kevin Brown is successful author and publisher of many informative websites including <a target="_new" href="http://www.home-loans-101.com/">http://www.home-loans-101.com</a> . His websites offer tips and advice on a wide array of topics including
<a target="_new" href="http://www.home-loans-101.com/">home loans</a>, mortgage refinancing, home equity loans and more.</p><br>