| Homeowners who are considering re-financing | | | | consider meeting with a re-financing expert to |
| their home may have a wealth of options | | | | determine the best refinancing strategy. This will |
| available to them. However, these same | | | | likely be a strategy which is financially sound but is |
| homeowners may find themselves feeling | | | | also still geared to meeting the needs of the |
| overwhelmed by this wealth of options. This | | | | homeowner. |
| process does not have to be so difficult though. | | | | Homeowners who feel as though they are |
| Homeowners can greatly assist themselves in the | | | | particularly well versed in the subject of |
| process by taking a few simple steps. First the | | | | re-financing might consider skipping the option of |
| homeowner should determine his refinancing goals. | | | | consulting with a re-financing expert. However, |
| Next the homeowner should consult with a | | | | this is not recommended because even the most |
| re-financing expert and finally the homeowner | | | | educated homeowner may not be aware of the |
| should be aware that re-financing is not always | | | | newest re-financing options being offered by |
| the best solution. | | | | lenders. |
| #1-Determine Your Goals for Re-Financing | | | | While not understanding all the options may not |
| The first step in any re-financing process should | | | | seem like a big deal, it can have a significant |
| be for the homeowner to determine his goals and | | | | impact. Homeowners may not even be aware of |
| why he is considering re-financing. There are | | | | mistakes they are making but they may here of |
| many different answers to this question and none | | | | friends who re-financed under similar conditions |
| of the answers are necessarily right or wrong. | | | | and receive more favorable terms. Hearing these |
| The most important thing is that the homeowner | | | | scenarios can be quite disheartening for some |
| is making a decision which helps him achieve his | | | | homeowners especially if they could have saved |
| financial goals. While there are no right or wrong | | | | considerably more while re-financing. |
| answer to why re-financing should be considered | | | | #3-Consider Not Re-Financing as a Viable Option |
| there are, however, certain reasons for | | | | Homeowners who are considering re-financing |
| re-financing which are very common. These | | | | may realize the importance of evaluating a |
| reasons include: | | | | number of different re-financing options to |
| - Reducing monthly mortgage payments | | | | determine which option is best but these same |
| - Consolidating existing debts | | | | homeowners may not realize they should also |
| - Reducing the amount of interest paid over the | | | | carefully consider not re-financing as an option. |
| course of the loan | | | | This is often referred to as the do nothing option |
| - Repaying the loan quicker | | | | because it refers to the conditions which will exist |
| - Gaining equity quicker | | | | if the homeowner does not make a change in |
| Although the reasons listed above are not the | | | | their mortgage situation. |
| only reason homeowners might consider | | | | For each re-financing option considered, the |
| re-financing, they are some of the most popular | | | | homeowner should determine the estimated |
| reasons. They are included in this article for the | | | | monthly payment, amount of interest paid during |
| purpose of getting the reader thinking. The reader | | | | the course of the loan, year in which the loan will |
| may find their mortgage re-financing strategy fits | | | | be fully repaid and the amount of time the |
| into one of the above goals or they may have a | | | | homeowner will have to remain in the home to |
| completely different reason for wanting to | | | | recoup closing costs associated with re-financing. |
| re-finance. The reason for wanting to re-finance is | | | | Homeowners should also determine these values |
| not as important as determining this reason. This | | | | for the current mortgage. This can be very |
| is because a homeowner, or even a financial | | | | helpful for comparison purposes. Homeowners can |
| advisor, will have a difficult time determining the | | | | compare these results and often the best option |
| best re-financing option for a homeowner if he | | | | is quite clear from these numeric calculations. |
| does not know the goals of the homeowner. | | | | However, if the analysis does not yield a clear cut |
| #2-Consult with a Re-Financing Expert | | | | answer, the homeowner may have to evaluate |
| Once a homeowner has figured out why they | | | | secondary characteristics to make the best |
| want to re-finance, the homeowner should | | | | possible decision. |