If you are thinking about refinancing your mortgage, you should be aware of the variable and factors that may effect your new rate. Home mortgage refinance rate change depending on the housing market and economy.
At the time that you purchased your home, the housing market determined your interest rates as well as your credit score and your down payment. If your original loan was set at a fixed rate mortgage which for any number of reasons has decreased, then you may want to refinance to get a better rate. This is the perfect time to refinance your mortgage. You have the option of exchanging your low interest rate for a much higher one.
This will give you a lower monthly payment as well. It is so important to wait until you really need to refinance you mortgage. With that being said, there will come times when you would like to pull some of the equity out of your home for many different reasons, but it is important to refinance at the right time and for the right reasons.
When you refinance your home mortgage rate, you will also shorten your repayment term. For instance, if you have been paying on your mortgage for 10 years and you have a 30 year mortgage, by refinancing you can now choose a shorter term. Not only can you save yourself thousands of dollars in interests, but you will also be able to build the equity of your home.