Refinancing to lower mortgage repayments
Refinancing?
is it the right
option for you?
1. Why refinance?
Refinancing can be a strategy to secure a lower monthly mortgage repayment rate. Switching to a different type of loan can also allow you to consolidate your debts or pay down your mortgage in a way to fits your current financial circumstances.
2. The Impact of Repayment Frequency on Interest Savings:
One strategy that homeowners often consider is refinancing their home loan and changing their repayment frequency. Repayment frequency can have a significant impact on the amount of interest you pay over the life of your loan.
By principle, when you make more frequent repayments, you reduce the outstanding principal balance more frequently, leading to less interest accruing over time. However it is important to speak to your financial planner or a mortage broker before making any adjustments to your home loans.
3. Assessing Your Loan Terms and Flexibility:
Before considering refinancing to change your repayment frequency, it's essential to review your current loan terms and assess the flexibility offered by your lender. Some loans may not allow for more frequent repayments or charge fees for adjusting the repayment frequency. Evaluate your loan agreement and consult with your lender to understand the options available to you. If your current loan does not provide the flexibility you desire, refinancing can be a viable solution to find a lender that offers the repayment frequency that aligns with your financial goals.
4. Refinancing Considerations.
When contemplating refinancing to change your repayment frequency, it's essential to consider a few factors. Start by researching and comparing different lenders to find one that allows for more frequent repayments without additional fees. Assess the overall cost of refinancing, including application fees, legal fees, and potential exit fees from your current lender.
5. Speak to the Mortage Experts.
Navigating the refinancing process can be complex, and seeking guidance from mortgage professionals is highly recommended. Mortgage brokers and financial advisors can provide tailored advice based on your unique circumstances. They can help you assess the feasibility of changing your repayment frequency, compare loan options, negotiate with lenders, and guide you through the refinancing process. Their expertise and knowledge of the market can assist you in making an informed decision that maximizes your interest savings.
Paying too much for a home loan?
See how we saved customers more than $6000 per year, just by reviewing their home loan.
