Have You Considered Refinacing Your Loan?

December. 31,2020
Have You Considered Refinacing Your Loan?

During the epidemic, under the fear of the economic crisis, many people began to consider other investment methods. Among them, buying a house in the United States became a very hot topic. But buying a house always involves loans and other issues. Many people currently have very low or no credit scores. What if the loan interest is high? Don't worry, figure out Refinance. Even if the credit score is low and the loan interest is high, one day in the future, it can help you reapply for the loan, so that you can save a fortune in buying a house!

 

What is Refinance ?

Refinance "refinance" literally means "take new loans to repay existing loans." The new loan may have lower interest rates, which can help you improve your financial situation and make your new loan more cost-effective.

 

The process is often as follows:

1. You want to lower interest rates and improve existing loans

2. Find a good lender (bank) and apply for a new loan

3. Repay existing debts with new loans

4. Pay the new loan on time until you pay off the loan

 

What are the benefits of Refinance?

• Save money: The reason for Refinance is to save interest. Generally, Refinance can lower the existing interest rate, especially for long-term or large loans. For example: your existing mortgage interest is 7%, after Refinance, you may be able to get a lower mortgage interest, such as 4% or 5%, so the mortgage is reduced.

 

• Change the loan period: When you apply for Refinance, you can restart the "loan clock" to extend the time it takes you to repay the loan to reduce your monthly payment. For example: your current mortgage interest is 7%, and you will continue to pay for 30 years. If you decide to apply for Refinance in the 10th year, you may not only get a lower interest rate, but you can also start your mortgage again from 30 years. Buy yourself more time to repay. If you don't want to extend the payment time, you can also shorten your loan period through Refinance. For example: Convert a 30-year housing loan Refinance into a 15-year housing loan, and use lower interest to repay the loan.

 

 

• Consolidated debt: If you have multiple loans, consolidating them into one loan can help you lower interest rates and make it easier to repay the combined payment. For example, if you have three credit cards, all of which have different interest rates, you can apply to combine the debts of the three credit cards and repay them together. The advantage of this is that you are likely to get a lower interest rate without paying separately.

 

• Change your loan type: If you use a variable rate loan, you can change it to a fixed rate loan through Refinance. For example: When the economy is in a recession, the market has high floating interest rates. At this time, if a fixed interest rate (usually between 4%-5%) is activated through Refinance, it will help lenders save a lot of interest.

 

When is Refinance suitable?

• Credit score has become higher: If you apply for a loan when your credit is low, your interest rate may be higher, but after a period of time, your credit score may become higher. You can consider Refinance to repay at a lower interest rate. Your debt.

 

• House renovation: If you buy a house and the mortgage interest rate is low after a while, or the mortgage is almost paid off, you can apply for Refinance to refresh the items in your home that require long-term loans, such as adding a swimming pool, renovating a room, renovating the property, suppose you The credit is good, you can use Refinance to pay the mortgage, and then use the remaining money to complete the expenditure items that need to be modified in the home.

 

How to apply for Refinance?

First of all, first understand your credit evaluation. Even if your credit score is high, other companies may have better discount prices and interest for you. You can tell the lender to help you quote a price before you apply, and then look for more favorable terms everywhere. But remember not to apply for loan Refinance from different homes at the same time, because this will not only cause your credit rating to become lower, but also make your future loan interest rates higher.

 

Which Refinance companies are better?

Quicken Loans

Quicken Loans, the largest online lending company in the United States, can choose to use fixed interest rates ranging from 8 to 30 years in addition to the 15-year and 30-year term options.

 

AmeriSave 

AmeriSave advertises that it will not require SSN or pull credit reports to harm credit score records, and it will get interest rate quotes and Pre-Qualification within three minutes.

 

Better Mortgage Corporation

Better Mortgage Corporation has a very intuitive and easy-to-operate interface. You can provide a quotation through a few simple questions about the type of house and the market value. It can be completed online with very few human intervention. Try this platform to get an interest rate reference.

 

Paramount Bank

Paramount Bank: Provides quotations for various loan types, including Jumbo, Conventional, FHA, VA, etc., advertises customizable loans and guarantees the lowest interest rate.