First, Consider A Few Factors Before Choosing to Refinance

Before deciding whether or not to refinance your mortgage there are a few details you should take note of. Foremost, timing is absolutely everything. Yet, at the same time, timing is also a thing most uncertain and more so, not completely reliable, especially on home refinancing territory. It will be essential to know your current mortgage information though, as being aware of it will allow you to mull around and decide if refinancing now, and not a few months or years down the line, is in fact the right and viable thing to do. Knowing your current mortgage details will also prove beneficial when it comes time to decide on a new mortgage deal through refinancing.

Choose, Sooner Than Later

Keeping timeliness in mind, there are a few factors in which you should take keen notice of as to best position yourself when deciding to refinance now or later on, or, on the other hand, ever.

It's Best to Know Your Loan Balance and Interest Rate

Knowing - or finding out what – your loan balance is is something anyone should be aware of or, on the other hand, can become aware of quite easily. If you're not already logging the history of your mortgage payments, you probably should. But, going with the assumption that you have not been keeping track, you need to contact your lender, where upon doing so will simply reveal your loan balance. Why know the loan balance? Silly you should ask. It's simply because by knowing the base amount the loan currently exists as, you will be better able to price out hopeful and prospective monthly amounts on a new mortgage.

As well as your overall loan balance, it's crucial for you to know which rate your loan is working on. Locating your interest rate is easy as, well, cake; although it might not be as delicious. Mull through your loan documents and official paperwork to target your interest rate. If can't locate it yourself, contact your lender immediately as this figure is essential to know for comparing with rates on potential, new mortgages.

Term Knowledge, Prepayment Penalties and Equity Quality

Being knowledgeable about your term is all too important. It will either be a fixed rate or an adjustable rate. If your term is one on an adjustable mortgage, a rate increase could very well be on the horizon, which is something to take into consideration. Yet, if you have a fixed rate mortgage, take in the fact that your rate will be set in stone and unchanged before an act of refinancing occurs.

Certain lenders are known to add on a prepayment penalty as to prevent particular borrowers to refinance a mortgage loan. These typically involve some sort of set fee or an actual raw percentage payment that imposed is a refinance is conducted. If this applies to you, since you have one, then it will be key for you to do some math on your own to determine if a refinance option would is favorable to your wallet.

Also, factor in the amount of equity you possess on your home. If you have lower equity then you might be better off opting for a refinancing approach. If you're unsure of what your equity (value of your home) is, then it would be wise to hire and consult a well-renowned appraiser to perform an appraisal on your home.