Refinance Loan
Refinancing your home loan means moving your home loan balance (the outstanding of your loan) from one lender to another.
It is important to review your home loan frequently. This helps you identify opportunities to save on interest or get better value out of a new loan. This is a complimentary benefit when you engage our Brokers. Secure Finance strengthens our client's financial standing through actively reviewing the secured loans every year.
How does it work?
Why Refinance Your Loan?
Lower Interest Rate:
One of the most common reasons for refinancing is to secure a lower interest rate. If market interest rates have decreased since you initially took out your mortgage or if your credit score has improved, you may be eligible for a lower rate, which could result in significant savings over the life of the loan.
Change in Loan Term:
Refinancing also allows you to change the term of your loan. For example, you may choose to switch from a 30-year mortgage to a 15-year mortgage to pay off your loan faster and save on interest payments. Alternatively, you could extend the loan term to reduce your monthly payments.
Access Equity:
If your home has increased in value since you purchased it or you've paid down a significant portion of your mortgage, you may have built up equity in the property. Refinancing can allow you to access this equity by borrowing against it, either through a cash-out refinance or a home equity loan or line of credit.
Consolidate Debt:
Refinancing can also be used to consolidate high-interest debt, such as credit card debt or personal loans, into your mortgage. By rolling these debts into your mortgage, you may be able to secure a lower overall interest rate and simplify your finances by having one monthly payment.
Switch Loan Type:
Another reason to refinance is to switch from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage or vice versa. This can provide more stability if you're concerned about fluctuating interest rates or allow you to take advantage of lower initial rates offered by ARMs.
Remove or Add a Co-Borrower:
Refinancing also provides an opportunity to remove or add a co-borrower from the loan. For example, if you initially purchased the property with a partner but have since separated, you may want to refinance to remove their name from the mortgage.
Review Loan Terms:
Refinancing gives you the chance to review and update the terms of your loan, such as prepayment penalties, closing costs, and repayment options. You can choose a loan that better aligns with your current financial situation and goals.
It's important to carefully consider the costs and benefits of refinancing before proceeding, including any application fees, closing costs, and potential impacts on your credit score. Additionally, it's advisable to shop around and compare offers from multiple lenders to ensure you're getting the best deal possible. Consulting with a financial advisor or mortgage broker can also help you make an informed decision about whether refinancing is right for you.
What Are The Benefits?
Lower Interest Rate:
One of the most common reasons for refinancing is to secure a lower interest rate. If market interest rates have decreased since you initially took out your mortgage or if your credit score has improved, you may be eligible for a lower rate, which could result in significant savings over the life of the loan.
Change in Loan Term:
Refinancing also allows you to change the term of your loan. For example, you may choose to switch from a 30-year mortgage to a 15-year mortgage to pay off your loan faster and save on interest payments. Alternatively, you could extend the loan term to reduce your monthly payments.
Access Equity:
If your home has increased in value since you purchased it or you've paid down a significant portion of your mortgage, you may have built up equity in the property. Refinancing can allow you to access this equity by borrowing against it, either through a cash-out refinance or a home equity loan or line of credit.
Consolidate Debt:
Refinancing can also be used to consolidate high-interest debt, such as credit card debt or personal loans, into your mortgage. By rolling these debts into your mortgage, you may be able to secure a lower overall interest rate and simplify your finances by having one monthly payment.
Switch Loan Type:
Another reason to refinance is to switch from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage or vice versa. This can provide more stability if you're concerned about fluctuating interest rates or allow you to take advantage of lower initial rates offered by ARMs.
Remove or Add a Co-Borrower:
Refinancing also provides an opportunity to remove or add a co-borrower from the loan. For example, if you initially purchased the property with a partner but have since separated, you may want to refinance to remove their name from the mortgage.
Review Loan Terms:
Refinancing gives you the chance to review and update the terms of your loan, such as prepayment penalties, closing costs, and repayment options. You can choose a loan that better aligns with your current financial situation and goals.