Refinancing your home is a major decision. Many people wonder if they should take the time, and pay for the extra closing costs and fees to refinance their house. In some cases, it may not be worth it, but in many instances it is the best thing that you can do. Here are a couple reasons why you should consider refinancing your home.
1. You Had A Co-signer
Many first-time homebuyers cannot qualify for a loan unless they had a co-signer. It could be a friend or family member that co-signs on the loan to help you get into a house. However, having a co-signer shouldn't be a long-term thing. It is better for both you and the co-signer if you can get the mortgage into your own name as soon as possible.
For this reason, as soon as you are able you should refinance the home to get the co-signer taken off. If you are self employed this might mean you need a couple years to prove income. If you had a significant raise in your credit score or income, you might be able to get the co-signer taken off. If you have questions about getting the co-signer taken off you should talk to a mortgage lender right away.
2. You Had A Flexible Interest Rate
Some people choose a loan that is a flexible rate, or get a higher interest rate because that was all they could get approved for. Although this may seem like a good idea in the beginning, it can really harm you in the long run. This is why it is important that as soon as you get in a better financial situation that you get out of the current loan and get a fixed rate loan.
This also applies if you have an interest rate on your loan that is high. You can check interest rates almost daily to see how yours compares. If you notice that yours is unusually higher you should consider refinancing.
3. You Had A Considerable Change In Income
You might be able to get a better interest rate if you can prove a higher and more stable income. If you have had a change in your circumstance considering your finances you should consider talking to a mortgage lender, such as one from Liberty Escrow Inc. They can give you a better interest rate if you can prove that you are more financially stable.
These are just a couple reasons to refinance your home