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Refinancing Your Home is Simple With MortgageAdvisor.com

There are several different refinancing options when it comes to mortgages. Other mortgage sites simply focus on giving you refinancing rates instead of giving you all the information you need to find the right refinancing option, lender, and rate for you. At MortgageAdvisor.com, we operate differently.

Our Mortgage Advisors help you explore all of your refinance mortgage options and as they learn more about your current situation and goals, they will help advise and guide you to find the best refinance option and lender that will work for your lifestyle and most importantly, your budget.

What is Refinancing?

A mortgage refinance is what you do when you want to replace your existing home mortgage with a new one. You typically refinance when your current mortgage is not as cost-effective as negotiating better terms on a new mortgage would be, e.g. mortgage loan interest rates have dropped since your original home loan or you want shorter loan terms. When you refinance your mortgage, you essentially work with lenders to satisfy your current loan and start making payments on the new refinance mortgage loan.

When can I Refinance my home?

Each lender and bank has varying conditions that need to be met before you can refinance your home. While this is the case, most require that you have your original home loan for a minimum of 12 months before you can refinance. If you are deciding on which institution to do your home refinancing through, you may consider that most lenders and banks will do their best to maintain you as a mortgage customer (especially if you’re making your payments on time, etc.). As this is the case, if you talk with them about refinancing, they will often do what they can to minimize your refinancing costs and efforts by not requiring a new property appraisal or title search.

Before you sign any refinance mortgage papers, we suggest that you explore your refinance options with a Mortgage Advisor to ensure that you are getting the best deal.

Traditional Refinancing vs Cash-Out Refinancing

There are two different ways to do a refinance mortgage, including:

Traditional Refinance

Refinance your current loan into a new loan with a better interest rate and loan terms. There are many reasons you would want to do a traditional refinance mortgage, including:

  • Decreasing your monthly payment
  • Decreasing your interest rate
  • Renegotiating the term of your loan
  • Switching from a variable to a fixed rate

Cash-Out Refinance

Take out more than the amount you owe on your existing mortgage so you can have extra cash. There are several reasons why you would want to do a cash-out refinance mortgage. These include:

  • Buying a new car
  • Paying off high-interest debt, such as credit cards
  • Making payments on college expenses, student loans
  • Funding repairs, home improvement projects
  • Adding new features to your home to add value (landscaping, pool, etc.)
  • Starting a fund for emergencies

What kind of loans can I Refinance into a Conventional Loan?

You are able to refinance any type of loan product into a conventional refinance, this includes:

  • Adjustable rate mortgages
  • FHA loans
  • VA loans
  • Sub-Prime loans
  • Alt-A loans
  • USDA mortgages
  • Option ARMs

The Cost of Refinancing Your Mortgage

This is likely onse of the most common questions when it comes to deciding whether or not to apply for mortgage refinancing. A key similarity with a refinanced mortgage loan and any other home loan is that you will still be expected to pay the closing cost and fees that are associated with the new loan you’ve refinanced. These fees can include an application fee, an appraisal fee, a loan origination fee, and more.

When talking with a Mortgage Advisor, you should ask about the costs associated with a refinance mortgage so you won’t experience any surprises at signing. You can also use our Home Affordability Calculator to find out what kind of costs and fees to expect with a refinance.

FHA Refinance Options

The primary reason to refinance your FHA loan is to get a better interest rate or loan terms and to get rid of your mortgage insurance, also known as your Mortgage Insurance Premium (MIP).

FHA Lenders charge MIP on FHA loans to offset their lending risk because FHA loans only require a 3.5 percent down payment. As soon as you have 20 percent equity in your home (this can be due to home prices increasing or paying off your loan, or even a mix of the two) you can apply to refinance your FHA loan into a conventional loan, which can help you drop the MIP expense. If you have 20 percent equity, you can also refinance your FHA loan into a new FHA loan, otherwise known as an FHA Streamline Refinance. The benefits of doing an FHA Streamline include being able to get a smaller monthly mortgage payment and a lower interest rate.

Refinance Your VA Home Loan

As with FHA loans, there are also several reasons why you would want to refinance your VA loan. VA loan refinances are very similar to conventional home mortgage refinances in that they offer many of the same benefits, including a lower interest rate, cashing out equity, decreasing your monthly payment, and/or changing your loan term.

Simple Refinance Your Mortgage Checklist.

There are a few steps to remember when it comes to a refinance mortgage, which is why it is helpful to have a simple checklist. Make sure you have these documents and identification with you to ensure a smooth process:

  • Your photo ID and social security card
  • W-2s from the previous two years and your last 3 pay stubs
  • All of your assets, including retirement accounts and investments
  • Proof of debts you owe by showing bank statements from the last two months. This includes alimony or child support payments, property tax bills, credit card and loan statements, and homeowners insurance statements.
  • Your credit score. If your credit score is too low, you may not qualify for a home mortgage refinance. Check your credit score for free.