When you originally took out a home loan in Kwinana, Rockingham or Baldivis you likely went with the interest rate and terms that were available at the time. Interest rates are ever changing, depending largely on the current world economics. If the economy is good, interest rates often drop so that people are encouraged to take out loans. If the economy heads south a bit, interest rates rise to discourage those without the needed finances from taking out loans that are too large to repay.
If you purchased a home when the economy was poor because you could get a good deal on home prices, you may have a home loan with a high interest rate. However, you are not stuck with a high interest loan forever. If you have a positive financial history, good credit and are currently paying off your home loan without problems, you’ll probably qualify for a home loan refinance.
Refinancing Changes Loan Terms
When you first began researching home loans, Kwinana lenders probably gave you a variety of different loan terms that accompanied the mortgage. You may have an adjustable rate mortgage, a fixed rate mortgage or a mortgage that extends 20 years or more. With a home loan refinance, our mortgage brokers in Kwinana and the surrounding areas can help you get a new loan with different terms. If you want to shorten the duration of your loan because you got a new job that pays you more money, we can help you. If the risk of an adjustable rate mortgage has started to worry you, your broker can see if you qualify for a fixed rate mortgage at a decent interest rate.
Qualify for a Lower Interest Rate
One of the best times to apply for refinancing is when interest rates take a dip. You can call mortgage brokers in Baldivis, Kwinana and Rockingham to ask about the current interest rates for refinancing but you won’t know what rate you’ll get until you actually apply for a loan.
Most lenders will try to get you at least a quarter of a point below what you’re currently being charged in interest. If your financial history is stellar, you may qualify to drop a whole percentage point or more in interest, especially if your current rate is exceptionally high.
Refinancing is a great way to add a little flexibility to your loan. If you originally took out a loan when terms were tight and you didn’t have much room for negotiations, refinancing can help you save money and reduce the time you have to spend repaying the loan.