Loan Refinance
A Loan Refinance will remind you of what you went through in obtaining the original loan. That’s because, in reality a loan refinance is simply taking out a new loan. You will encounter many of the same procedures and the same types of costs the second time around.
You may be considering refinancing as part of debt consolidation or a student loan consolidation.
Refinancing can be a good idea for homeowners who:
- want to get out of a high interest rate loan to take advantage of lower rates. This is a good idea only if they intend to stay in the house long enough to make the additional fees worthwhile
- have an adjustable-rate mortgage (ARM) and want a fixed-rate loan to have the certainty of knowing exactly what the mortgage payment will be for the life of the loan
- want to convert to an ARM with a lower interest rate or more protective features (such as a better rate and payment caps) than the ARM they currently have
- want to build up equity more quickly by converting to a loan with a shorter term
- want to draw on the equity built up in their house to get cash for a major purchase or for their children’s education
Financial contracts can be very confusing. Before signing yourself to a major long term commitment have an attorney, familiar with financing and taxes, examine and explain the details (where the Devil is). A good tax finance attorney can save you many times his fee over the years, not to mention possible legal problems.
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