| Refinancing your house involves a sizeable upfront | | | | mortgage bill, but so can extending your loanperiod. In |
| cost. Fortunately,those initial fees can turn into a real | | | | the long run, lengthening your loan term will cost more |
| savings for you if you securelower rates. You can | | | | ininterest, but it can save your budget. |
| also add more money to your budget by reducing | | | | Another way to temporarily reduce your payments is |
| yourpayments. And finally, you can put your equity to | | | | to select aninterest only loan. For a year or two, you |
| good use byconsolidating high interest bills or investing | | | | can just make small interestpayments on your |
| in your future by paying forcollege or home repairs. | | | | mortgage, allowing you to save money. This makes |
| 1. Save Money With Lower Rates | | | | sense forthose who plan in a year to sell or see a |
| For most people planning to refinance, the goal is to | | | | dramatic increase in theirincome. |
| save money withreduced rates. This may mean | | | | 3. Put Equity To Good Use By Cashing Out |
| converting your original mortgage to afixed or | | | | For most people, they are house rich, but cash poor. |
| adjustable rate home loan. With fixed rates, you get | | | | By pulling outyour equity during refinancing, you can use |
| security of asteady rate and monthly payment. | | | | your equity to consolidatebills or pay for college or |
| Adjustable rates can be lower, but canchange as the | | | | home repairs. Eliminating your high interestcredit card |
| market rates rise and fall. | | | | debt will help out your monthly budget. Investing in |
| To get the most out of refinancing, you usually need to | | | | yourfuture will pay off in future dividends. |
| stay in yourhome for at least seven years. In some | | | | To really understand the cash benefit of refinancing, |
| cases, you can break even onclosing costs sooner, | | | | request a loanquote from a lender. Then analyze your |
| especially if you selected a no fee loan. | | | | monthly and interest savings witha mortgage |
| 2. Increase Cash Flow With Lower Payments | | | | calculator. From these numbers, you can decide |
| Reducing monthly payments is another reason to | | | | ifrefinancing is worth it. |
| refinance. Lower ratescan push down your monthly | | | | |