Should I refinance - When considering whether or not to refinance your home, you must decide if the refinance will result in a net benefit to you. It is ultimately up to you to decide what is in your best interest, not a loan oficer.

If you are simply looking to lower your monthly mortgage payment, you may want to consider what is called a "rate and term" refinance. This simply means that you are refinancing to recieve a lower interest rate, and to spread your payments out over a different amount of time. Some people will refinance to change to a 15 year loan, because they want to pay off their mortgage sooner. Most, however, will go with a loan that is amortized over 30 years, because that will result in lower monthly payments.

If you want to eliminate some of your other high interest debt, you can do so by rolling that debt into your current mortgage. This is referred to as a debt consolidation refinance. The benefit of a consolidation refinance is that you can take all of your high interest credit cards, and lower the interest to whatever rate you will be paying on your new mortgage. Also, you have the convenience of only making one payment every month.

Consolidating your debt doesn't actually eliminate it. It simply lumps it all together, and lowers the interest rate that you pay each month.

If you want to cash out some of the equity in your home to make home improvements, take a vacation, buy a new car, or something else, you can. This is called a "cash out" refinance. A responsible loan officer will advise against pulling equity out of your home to reap short term benefits, such as taking a vacation. Although it may be tempting to do so, you will be paying interest on that money, and in the long run you will probably regret it. However, if you want to make home improvements, then you can actually improve the value and beauty of your home by using some of your equity to pay for it.

It is important to know that, although the equity in your home is yours, if you cash-out some of it, it isn't like withdrawing money at the bank. You are taking out a loan against the value of your home. You will pay interest on that loan, and therefore your monthly payments will go up.

Call me today at 718-886-4438 to discuss whether or not a home refinance may be in your best interest. I'm here to help!

Keep in mind that with any type of refinance, you will also have to pay the closing costs on the new loan, which can be around $5,000 to $6,000 or more. You must determine if it is worth it to you to pay these costs in order to reap the benefit of the refinance. A good loan officer will evaluate your situation as well, to determine whether or not it is in your best interest to refinance. Ultimately, though, the decision is yours, and the loan officer is there to help you no matter what decision you make.

How do I refinance - The first step to refinancing is to write a list of what your needs really are. Are you in need of cash, lowering your payments, or want to buy a car etc.

It is wise to start with your current lender as a benchmark and then get some quotes from mortgage brokers and compare.

Next you will want to contact a reputable mortgage broker who can listen to your needs and present you with different mortgage programs that will fit your plans and help you achieve your goals..

Once you have determined the purpose of your refinance, for lower payments or cash out the equity in your home, contact a loan officer to see your options and get a free quote. There are too many loan programs available for you to go it alone. The average homeowners are not familiar with the options available to them. A mortgage broker can often help to achieve their refinance purposes.

There are two types of refinances - Rate and Term Refinance, in which the purpose is to refinance for a lower interest rate or a shorter/longer loan term, and Cash-Out Refinance, which purpose is to withdraw from the equity in the property.

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