home buyer

Maybe you bought your first home together before the wedding and have been making payments on it for some time now.

If you’ve been a homeowner for a while, you most likely have
a mortgage and are making regular payments to a broker, a bank, or a lending
institution. But did you know that the rate that you pay for that loan is not
fixed forever? Depending on lending rates, land values, and interest rates, you
could possibly work out a way to pay a lower rate, or extend your loan by a few
more years if you are going through a tough time.

One of the ways to manage your mortgage is through
refinancing. This is basically trading one loan for another, which means
replacing your current mortgage with a new one-preferably one with more
beneficial terms. For some homeowners, the move to refinance has managed to
save them hundreds of thousands of dollars. For the unlucky few, though, a
miscalculation in timing could mean that a refinancing extends their loan at
the very least.

The Right Time to Refinance Your Mortgage

So when is the right time to think about refinancing your
mortgage loan? Is it something every homeowner with a mortgage should consider,
or is it a special case that applies to certain cases only? There’s no easy
answer to these questions, especially if you’re trying to navigate the
financial ins and outs by yourself.

Working with a Mortgage Broker

Try to work with a mortgage broker who originally managed to
secure your initial mortgage. A broker can intercede with mortgage lenders on
your behalf. For example, you need a mortgage lender in Boston. Your
mortgage broker will go through their certified partners and gather the
necessary documents. They will work with you to complete all the information
needed. They will also conduct the credit history check and do all the other
tasks related to applying for a loan. They will try to make sure that you have
the best available rates for your loan bracket.

But before you go hunting for a real estate mortgage broker,
consider the reasons you have for refinancing and if it is the right time for
you.

Lower Interest Rates

One great reason that might lead you to refinance your
current loan is the occurrence of lower interest rates. Trading an old loan
with a bloated interest rate for a fresh new loan with better terms and
interest rates is always a good deal. The rule of thumb is to refinance when
current rates drop to one to two percent below the rates that you have. Another
indicator that you should consider refinancing is if your property
values go up. This will give you sufficient leverage to refinance on more
advantageous terms.

You might consider refinancing if your credit score has
improved. We all know that loan rates are higher when you are considered more
of a risk. Some homeowners take on an adjustable rate mortgage (ARM) to help
keep rates stable for a fixed time. However, with an ARM, one is never sure how
the interest rates will move. They may move higher as different economic
factors come into play. With an improved credit rating, you could negotiate for
a better fixed rate. This will afford you peace of mind and might even pave the
way for better situations further down the road.