5 Questions To Ask Before Seeking A Refinance Mortgage Loan In Victoria
While a refinance mortgage loan might sound like a great idea to a Victoria resident, there are certain things that we need to know before making a final decision. It is more difficult to receive a refinance mortgage loan in Victoria than ever before. As such, there are a few things that we need to know.
Let's take a closer look at the five questions that need to be asked prior to seeking out a refinance mortgage loan in Victoria. Those who take the time to read on and learn more give themselves the chance to learn everything that they need to know.
1) What's The Level of Equity?
The level of equity that we have in our homes plays a major role in our ability to receive various loans. In most instances, the applicant will need to have a 20 percent equity in their home before they are able to qualify for any new loans. Private mortgage insurance expenses are added to any loan that is taken out by a homeowner who does not have 20 percent equity, which can negate any of the potential benefits that such a loan would provide.
2) What About The Credit Score?
The credit score of the borrower is always going to come into play when seeking out a loan of any kind and a refinance mortgage loan is certainly no different. In order to receive a loan with the proper interest rate, we will need to come into the process with a clean credit score. If the borrower has a credit score that has dipped below 620, their chances of receiving a refinance mortgage loan are slim to none.
3) What's The Objective?
We should never be seeking a loan for the sake of seeking a loan. We must come into the process with a strong idea of what we need. In other words: what is our chosen objective? Some may be looking to lower their current monthly payments. Others may want to adjust the terms of their loan. Before we embark on this process, we need to have a strong understanding of our objective. This eliminates any and all confusion.
4) How Long Are We Going To Stay In This Home?
This is a crucial factor in any decision that we are going to make as it relates to our mortgage loan. Before sitting down with a loan provider, we need to decide how long we will remain in our homes first. The refinance mortgage loan is going to be somewhat costly and the homeowner must decide how long it is going to take them to make their way back to the breakeven point. If the breakeven point can be reached relatively quickly, then the loan is usually a good idea.
5) What's The Rate Structure on the Current Loan?
Questions like these are typically asked by applicants who have found themselves stuck with an adjustable rate mortgage. While an adjustable rate mortgage might allow us to receive a lower monthly payment during certain times of year, a fixed rate mortgage is the better idea over the long haul.
Refinance Mortgage Loan Victoria