Myths of home refinancing busted
There are many reasons that you may want to refinance your home, which is exclusive to you and your situation. We are not here to talk about those reasons or even cover the process of getting a mortgage or refinancing. We are here to discuss today some common myths floating around about refinancing your home and why they need to be thrown out the window.
Our specialists have done the research, and now we are sharing home refinancing myths that we have busted.
- A Denial Stands Forever – There are many reasons why a lender may deny refinancing your home. It does not mean that you cannot ever apply again. You just need to work out what the problem was the first time around. For example, if you do not have enough equity built up, you will not be able to get refinancing on it until you reach their requirements. This is not that big of a deal. It will just take a year or two before you can apply again. This myth is busted!
- Closing Costs Are Expensive – This will depend on your loan, the value of your property, and the lender you have chosen. Some options available to you can lower these costs or even remove them from the table. You can have the charges added to the front end of your loan or agree to a higher interest rate in exchange for the lender waving the closing costs. Ask your lender and see if they are willing to work with you. If not, you may want to consider finding the best refinance home loan somewhere else. This myth is busted!
- 20% Home Equity Is required – It is common knowledge that most lenders want you to have 20% equity built up in your home before they even consider refinancing for you. To be clear, this is not a rule set in stone. It is the preferred amount by most lenders, but it does not necessarily mean that you can not get refinancing. The best thing you can do is talk to your lender, and if they are not willing to help you out, look around for another lender. This myth is busted!
- Refinancing Does Not Save You Any Money – This will entirely depend upon the interest rate attached to the new loan. One of the many reasons you would want to refinance is to get a better loan with a lower interest rate. Suppose you are going through the trouble of filling out application forms to get refinanced. In that case, you should ensure that the interest rates are as low as possible, saving you money overall. This myth is busted!
- All Lenders Are The Same – This is one of the biggest myths that is far from the truth. The golden rule to remember when dealing with insurance companies is to understand that not all carriers are the same. Not all policies will cover the exact amounts for the same prices. You should always compare all your options by using an online comparison site, such as iSelect. This myth is busted!
These are the 5 top myths about home refinancing that we have busted. You should never listen to what others claim are the set rules. As long as there is some human interaction at some stage of the process, there is always a chance that the so-called rules could be worked around. Most of the time, these guidelines are just that, guidelines, and they are not meant to be set levels by the lender’s representatives. With that being said, if you need to refinance your home, step up and go for it. You never honestly know what will happen until you try.