Should I refinance my mortgage? We outline some reasons you might consider it.
When should I refinance my mortgage? Only when it makes financial sense to do so.
In the past, most people who took out a mortgage continued with it until they had paid it off. These days, people refinance their mortgage much more frequently. We recommend reviewing your loan every 2-3 years or when your financial circumstances have significantly changed. Some common reasons for refinancing a mortgage include:
Lower Interest Rate
This is the most common reason people refinance their mortgage. But be careful you don’t become rate fixated, you also need to consider fees and charges associated with exiting your current home loan and taking out the new mortgage. You need to be sure you’ll be better off in the long run after taking into account all costs.
Access their Equity
If the value of your property has increased, you may wish to access this equity for a number of reasons (e.g. investment, new car, renovations etc.). Refinancing your mortgage allows you to tap into that extra equity.
Some people find they have borrowed more than they can comfortably repay, or their circumstances have changed since taking on the loan, and they’re in danger of defaulting. Don’t suffer in silence - if you’re having trouble making your mortgage repayments, speak to us about refinancing your loan to make it more manageable.
People's circumstances change during a 30 year loan term, so it's unlikely the same mortgage product will suit your requirements for the entire term. People refinance into a mortgage product better suited to their current needs.
Inca Mortgage Solutions can perform a thorough assessment to compare available mortgage products with your existing loan facilities to help you determine whether you should refinance.