The Refinance Rush: How to Determine if You Should Start Running Toward it or Away

Since the announcement of the streamlined refinance program, there have been hundreds of thousands of applications for refinancing. This new feature allows those who qualify to refinance their loan to the country’s current very low interest rates.

Many people have done it and many people want to, but how do you know if you should? In this blog, we are going to do our best to break down this streamlined refinance and help you to figure out if it is the best move for your current situation.

How to Qualify

The first order of business is simple. What are the requirements and do you meet them? In order to qualify for the streamlined refinance you must have not refinanced your loan since May 2009; if you have refinanced sooner then you don’t qualify.

However, if you have not, then you do in fact qualify for this program. So, if you have made it this far, then chances are you are either really intrigued or you have discovered you do in qualify for the Streamlined Refinance. So, what now -- do you jump in on the refinance rush or not?

Deciding if Refinancing is Right Path for You

Everyone’s situation is different, and we obviously cannot hope to cover them all, but there is one variable that is always going to be detrimental when deciding if it is in your best interest to refinance. Will it save you money, in the short term, the long term, or both?

People refinance most often so that they can get a better interest rate, which will lower their monthly payment and save them money over the life of the mortgage loan.

Remember when you bought a home how you got your rate locked in because it was the best you could get at the time?

Well now, due to your credit improvements and interest rates being at an all time low, you can potentially refinance your mortgage loan down to a record low interest rate.

The goal is to save money and no matter what your credit was before, so long as you have made every payment on time, it will have improved. Typically, with improved credit come potentially lower interest rates through refinance, but with interest rates already at a ridiculously low rate, having good credit only makes it better.

So, in short, the ultimate all around rule with refinancing is to ask one question: Will this save me money in the long run? After all, you are trying to benefit your life and make something great.

If you have any questions, please feel free to contact Indigo Mortgage today so that we can help you determine if a refinance is right for you.

Posted by Indigo Mortgage at 5:20 PM 1 comment: