HAVE INTEREST RATES DROPPED?

Since the interest rates have dropped, now maybe the time for us homeowners to refinance. The object of a refinance loan is to pay off an existing loan for the purpose of lowering your current monthly payments, or reducing the amount of interest you want to pay. Refinanced loans become more popular when interest rates drop significantly, though there may be good reasons for you to consider a refinance mortgage loan even if the general interest rates have remained the same or increased. How does refinancing your current mortgage lower monthly payments and when should you consider a refinance mortgage loan?

What if you bought your house 10 years ago with a mortgage loan from a local Mortgage Broker? Because of your lack of credit history and perhaps a Bankruptcy, but your didn’t know about bankruptcy mortgage deals, along with your decision to put down a small down payment, you ended up with an interest rate that was significantly higher than average. A few years later, the standard interest rates have dropped by nearly a full percentage point which puts them nearly 3 percentage points below the interest rate on your current mortgage. You have been with your current employer for 9 years, lived in the same house and have paid bills on time, mortgage loan tips, would let you know that your situation is ideal for refinancing your mortgage because of the following:

· Your original mortgage carries a higher interest rate than the market because of the previous credit history, With bankruptcy mortgage deals, you would have known how to get a better deal, but you have made it through that period.
· Because you have paid your bills on time your credit rating allows you the ability to get the lowest interest rate available on new loans.
· Although most experts recommend you consider refinancing when the interest rate drops at least a full percentage point, a drop of 3 percentage points is very significant, and will place you in a better position to negotiate the loan.
· You may also consider refinancing to shorten the term of your mortgage. Even if you took out a 20 year loan for the same percentage rate as your current 30 year loan, the payments will be higher, but if your financial circumstances are better than when you originally took out the loan you will gain in overall savings.

As always make sure this is the ideal time for you to refinance. Your current financial situation will dictate which route is best for you. The ultimate goal is your personal financial ability and stability.
Consider all the above reasons, and make an informed decision on whether to refinance. The decision is up to you.

Happy Surfing,