Thinking of utilizing some of the existing equity in your home?
Here are some tips that may help you with the process.
Tip #1 - Check your Credit Score
Before you start the refinancing process, it’s important to check your credit score. The higher your credit score, the better your chances of getting a lower interest rate.
Tip #2 - Consider your Closing Costs
When refinancing, you’ll need to pay closing costs, which can add up quickly. This could include things like your penalty on your existing term, solicitor costs to re-sign and register the mortgage for the new loan amount and an appraisal.
Make sure you factor these costs into your decision to refinance.
Tip #3 - Choose the right term loan
When refinancing, you’ll have the option to choose a new loan term anywhere between 1-5 years. A shorter loan term will sometimes result in a higher interest rate, while a longer loan term may have lower interest rates, however the cost of borrowing will be different for each.
Tip #4 - Be Prepared for the Application Process
Refinancing requires an application process, which includes providing documentation of your income, assets, and debts. Be prepared to provide this information, and be patient with the process.
Overall, refinancing can be a great way to save money on your mortgage, but it’s important to do your research and consider all of your options before making a decision.