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Home Refinance Rates Article
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Refinancing
Most of us find ourselves taking out a loan at one time or another in our lives, whether it's for a home, a car or personal reasons.
At the time we take out the loan, it's usually set for some many months with monthly payments due on a certain day. The amount of the monthly payments is based on the current interest rate we're charged on the principal balance we borrow.
Often, during the term of the loan, we find ourselves refinancing the loan for one reason or another. The main reason why people do refinancing is usually for a better interest rate, specifically if the loan is a home mortgage.
With a home mortgage loan, refinancing for a lower interest rate can make a substantial difference in the total balance of our loan.
Lower interest rates are the most common reason for refinancing mortgage loans, but they are not the only reason for refinancing. When banks lend money for the purchase of a home, they will usually only borrow up to 80% of the value of the home (known as equity).
For instance, if a home is valued at $100,000, the maximum amount the bank will borrow is $80,000. As time passes, the balance of the loan decreases while the equity of the home increases. Often home owners need extra cash for remodeling or other personal reasons so they choose refinancing by using the equity of their home as collateral.
An example of this method of refinancing would be that same $100,000 home. After a couple of years, the loan balance may be down to $70,000 while the value of the home may have increased to $120,000.
In this scenario, the bank will borrow up to 80% of the home's value, which would be $96,000. This amount is $26,000 more than the borrower owes on his mortgage so they are eligible for $26,000 cash out. Refinancing of home mortgage loans is very popular for this reason.
While home mortgage loans are the loans that are most often refinanced, refinancing is not limited to just mortgages. Many borrowers take out loans when they purchase a car.
A lot of people like trading their cars off in a couple of years to get a newer model. Many times the first car loan is not paid off, so they do refinancing of their first car loan and add it to the new car loan. Another reason is for additional cash for personal reasons.
As long as the collateral of the loan (car, etc.) is worth more than the balance of the loan, banks are more than happy to help with refinancing, if the payments have been made on time, of course.
Home Refinance Rates Specific links
Home Refinance Rates News
Push intensifies to pass home-loan refinancing bill - The Hill (blog)
Push intensifies to pass home-loan refinancing bill The Hill (blog) Mark Zandi, chief economist with Moody's Analytics, told a Senate panel Thursday that he supports a measure to eliminate hurdles for homeowners to refinance into lower interest rates under the Home Affordable Refinance Program (HARP), and suggested ... HARP 2.0: Good News For Home Owners Who Are Upside Down Real estate industry pushes Senate on refi bill Don't HARP on it, refinance program too good to pass up |
Realtors(R) Offer Support for Bill to Help Responsible Homeowners Refinance - MarketWatch (press release)
 International Business Times | Realtors(R) Offer Support for Bill to Help Responsible Homeowners Refinance MarketWatch (press release) NAR supports the "Responsible Homeowner Refinancing Act" because it offers relief to responsible homeowners who have good credit and consistently meet their mortgage obligations, but who have been unable to refinance into lower interest rates because ... Freddie Mac: 30-year mortgage rate down a tick at 3.78% Record-Low Mortgage Rates - Are They Hurting US Housing Market? 30-year mortgage rate hits another record low |
Today's Mortgage Rates: Bank of America, Chase and Citibank Refinance Rates ... - Eastern Morning Herald
 Eastern Morning Herald | Today's Mortgage Rates: Bank of America, Chase and Citibank Refinance Rates ... Eastern Morning Herald Bank of America (NYSE:BAC), is in the circle of top US banks, that are offering home refinance packages at very attractive rates nowadays. The 30-year fixed refinance loan is being offered at a rate of 4.000% and an APR variable of 4.172%. Refinancing Up as Rates Keep Falling Mortgage applications up on refi demand: MBA Mortgage Refinance in Today's Real Estate Market |
When Does It Make Sense to Refinance? - MarketWatch (press release)
 Eastern Morning Herald | When Does It Make Sense to Refinance? MarketWatch (press release) By Peter Miller SANTA ANA, CA, May 21, 2012 (MARKETWIRE via COMTEX) -- While most people usually think of real estate "affordability" in terms of buying a home, the concept also applies to refinancing. Rate reductions may cut monthly costs and the ... Mortgage Rates Today: Wells Fargo, Citibank and KeyBank Refinance Rates for ... Record-low mortgage rates spur refinancing Mortgage Rates: Low Mortgage Rates Push Existing Home Sales Higher |
Real: FHA streamline refinance gets cheaper - The Republic
Real: FHA streamline refinance gets cheaper The Republic The government is about to make refinancing FHA mortgages more affordable -- and potentially easier -- for hundreds of thousands of homeowners. — The Federal Housing Administration will reduce mortgage fees significantly for borrowers who qualify for ... FHA Streamline Refinance Set To Spur Refinance Boom |