When is a Good Time to RefinanceMany homeowners think about refinancing, but they simply don’t know when to start the process. What is a good time for some to refinance and when should other homeowners wait? Low mortgage rates do not make refinancing the best idea for some, while for others, it could be one of the best financial decisions they ever made.

In order to figure out when it is a good time for you to re-finance, you need to ask yourself a few questions about why you are refinancing. If you can’t answer why, there’s no point in even considering refinancing. Next, once you have figured out why you should re-finance, you should decide if the timing is right.

Right Time to Re-finance Your Mortgage

Here are some situations that may mean it’s a good idea to re-finance now:

  • 1. Interest Rates Have Dropped: Take Advantage of Lower Rates

  • This is a great reason to re-finance in order to save money every month on your mortgage.

  • 2. You Can Afford a Higher Monthly Payment: Shorten Your Loan Term

  • If you can pay more every month on your mortgage, you can re-finance in order to get a loan with a shorter term. This way, you can own your home in less time.

3. You Need Funds for a Major Expense: Use Your Home’s Equity

  • If the expense justifies refinancing, you can pay for a major expense such as college tuition for your child or a home remodel.

4. Your Credit Score Has Improved: Unlock Better Mortgage Rates

  • Your current mortgage rate was determined by many factors, including your credit score at the time. It can be a great idea to re-finance if your current credit score has improved.

5. Weighing the Pros and Cons: Is Refinancing Right for You?

Before you make your final decision to refinance, be sure to weigh the pros and cons according to your particular situation. Remember, what’s good for one homeowner is not good for another!