Refinancing is process when you take out a new loan to replace your original loan.
When to refinance?
There is no prescribed timeline when a refinance should be considered. It is always dependent on ones individual circumstances and strategy.
Refinancing your mortgage can be a way to potentially lower your interest rate and monthly mortgage payment, but there are a number of other reasons one may consider to refinance:
1. To take advantage of low interest rates or a more competative package
2. To consolidate debt
3. To access equity in your home
Depending on your individual circumstances, refinancing can offer many benefits. A slightly better interest rate over the life of a loan can take of thousands of dollars of your mortgage, and enable you to pay out your loan much earlier. Based on an average loan of $400,000, a 0.5% difference over a 30 year loan would equal approximately $75,000+ in savings. On larger loans or investment portfolios in excess of $1M, the same figure could equate to over $300,000+. Cost of Refinancing is generally a fraction of the savings you could be making.
Are you paying high interest rates on your credit cards or your car loan? Why not consolidate all loans, into one, low-interest mortgage.
Talk to us today about your personal circumstances and how we can help you save money and open the equity in your home to start building a property investment portfolio.