Mortgage Refinancing
refinancing your home mortgage loan
Mortgage refinancing is defined as paying off an existing mortgage loan with the proceeds from a new loan, usually of the same size, and using the same property as collateral. In order to decide whether refinancing your home mortgage loan is worthwhile, the savings in interest must be weighed against the fees associated with the mortgage refinancing. The difficult part of this calculation is predicting how much the up-front money would be worth when the savings are received.
Other reasons for refinancing your home mortgage loan include reducing the term of a longer mortgage, or switching between a fixed-rate and an adjustable-rate mortgage. If there are prepayment fees attached to the refinancing of your existing home mortgage loan, mortgage refinancing becomes less favorable because of the increased cost to the borrower at the time of the refinancing.
