On The Money

Deciding on the Right Time to Refinance Your Home Loan

Home LoanIf you are a homeowner in Utah, you may be wondering if the right time for a home refinance is now. After all, interest rates are currently approaching all-time lows and the prospects of saving a lot of money on your monthly loan payments can be enticing.

Aside from the mortgage refinance rate that Utah lenders offer, you need to consider your financial situation before deciding whether or not to go for a refinance. Following are some benefits that may help in your decision-making process:

More Favorable Interest Rate

Obviously, the most popular reason that many people go for a mortgage refinance is the lower interest rate that comes with the move. By making the most of prevailing market conditions, you can lower the amount you need to pay for interest significantly.

Adjusted Terms

When you refinance, you get the opportunity to make some adjustments to your loan terms. You can opt for a shorter or longer period of time to pay off your mortgage completely. This way, you can build equity in the property more quickly or lower your monthly payments, depending on your preferences and specific situation.

Changing the Type of Loan

You also get the option to change the type of loan you have, aside from amending the terms. If you have an adjustable rate mortgage and you want to lock in a lower rate over the long term, you can refinance into a mortgage with a fixed rate.

Debt Consolidation

With a mortgage refinance, you can consolidate your multiple debts into a lower-interest home loan. This will allow you to save a considerable amount of money that you would otherwise use to pay for interest on different debts. The repayment process will likewise be simplified.

Paying off your debt quickly can help you improve your credit score, and this can help you address your financial needs more effectively, such as when you need to get a personal loan.