Why Refinancing Might Be Right for You
(Bankrate) — Why refi? There are at least seven reasons to refinance a mortgage. You probably can think of the first one — to get a lower mortgage rate. The average interest rate on an outstanding mortgage at the beginning of 2010 was 5.979 percent, according to the Bureau of Economic Analysis. However, lenders today are offering rates well below that benchmark, making a refinance a no-brainer for many. But low rates are not the only motive for refinancing a home loan nowadays. The following are good reasons to consider a new home loan.
Refi for a Lower Rate: The No. 1 reason to refi is to get a lower mortgage rate. Despite sinking rates, a lot of people haven’t refinanced. Many homeowners would like to refinance but can’t because they have little or no equity due to falling home values. Jim Sahnger, mortgage consultant for Palm Beach Financial Network in Stuart, Fla., says too many of his clients can’t refi for this reason. “But there are people who can, and some people who get so into whatever they’re doing that they don’t pay attention to the news and don’t pay attention to where rates are at,” Sahnger says. So Sahnger will call to tell them that rates are near record lows.