Many people lost their homes because they became upside down on their mortgages during the recession in 2008. Those who were fortunate enough to hold on to them were motivated by record-breaking low-interest rates to refinance their mortgages so that they’ll owe less each month. Others are motivated to do so for other reasons.
One type of homeowner that may look to refinance their home is one with an adjustable-rate mortgage (ARM). Those looking to qualify to purchase a home often are attracted to these types of home loans because they offer far lower interest rates than fixed-rate mortgages do.
The only problem with ARMs is when their rate starts to adjust. Once it does, it happens regularly. It fluctuates depending on your credit score.
Augusta homeowners who improve their credit scores may also decide to refinance their mortgages. Before a lender offers you a loan on a home, they’ll generally look at your credit score and your borrowing history. They’ll convert that information into a percentage, which they tack on to the lowest interest rate out there. The higher your credit score is, the more likely that it is that you’ll be assessed an amount closer to that prime rate.
Another reason that homeowners refinance their homes is if they have a big expense that they need to pay for. Banks will often lend you the difference between what’s owed on your mortgage and what you borrowed to spend as you wish.
One of the biggest mistakes Georgia homeowners make when they decide to refinance their homes is that they decide to move forward and do it for the wrong reason and at the inappropriate time. If you’re looking to minimize your mortgage payments, then an attorney can guide you through this and any type of real estate matter.