Welcome to The Loans Reference: Refinancing Guide
Mortgage Refinance Rates Article
. For a permanent link to this article, or to bookmark it for further reading, click here.
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.
from: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.
Mortgage Refinance Rates News
Homeowners with good credit scores are poised to capitalize on ... - Baltimore Sun
 Best Syndication | Homeowners with good credit scores are poised to capitalize on ... Baltimore Sun, United States - Jumbo loan rates, however, are closer to 6.75 percent. David Junkin of Timonium plans to refinance, not to save money on his mortgage payment but to guard ... Mortgage rates are low, but loans difficult to get Low Mortgage Rates Have Many Refinancing Report: Ga. mortgage rates among lowest |
Mortgage applications dipped before Fed move: MBA - Reuters
Mortgage applications dipped before Fed move: MBA Reuters - The jump in applications during December may have been homeowners already "on the fence" and prepared to refinance on a drop in mortgage rates, she added. ... Mortgage applications down, home-equity credit delinquencies up Week-to-week mortgage applications down 8.2% Mortgage Applications Decrease In Latest MBA Weekly Survey |
Non-Agency Mortgage Bonds Rallied as Rates Declined - Bloomberg
 AFP | Non-Agency Mortgage Bonds Rallied as Rates Declined Bloomberg - ... efforts to drive down mortgage rates, which means foreclosure sales may be less costly and more borrowers may be able to refinance, Ajay Rajadhyaksha, ... Fed Refills Tool Kit Amid Growing Signs Of Long Downturn The Mortgage Market This Week Fed starts buying securities backed by housing agencies |
Jumbo mortgage loan rates put damper on refinancing - Boston Globe
 Boston Globe | Jumbo mortgage loan rates put damper on refinancing Boston Globe, United States - (John Tlumacki/Globe STaff) By Jenifer B. McKim While plunging mortgage rates have spawned a frenzy of refinancing, borrowers with larger, so-called jumbo ... Jumbo mortgage shoppers get little relief |
As Vacant Office Space Grows, So Does Lenders’ Crisis - New York Times
 New York Times | As Vacant Office Space Grows, So Does Lenders’ Crisis New York Times, United States - Rising vacancy rates were expected in Orange County, Calif., a center of the subprime mortgage crisis, and New York, where the now shrinking financial ... Tough '09 Is Seen for Commercial Real Estate Commercial Real Estate A Recap of 2008 and Outlook for 2009 |