When and why to refinance should always be brought up while considering your budget, short and long term goals. At Partners Mortgage, we consult on a case by case basis to determine whether or not a refinance makes sense.

What are the 5 reasons to refinance?

• Lower the rate

Lowering your rate by at least 1% is the rule of thumb; a very simple decision. But, in these tight economic times even small decreases in your payment can make a large difference to you. Consider a refinance to re-amortize your loan and spread out the payments over another full term.

• Change term

A 15 year loan turned into a 30 year loan can save you 20-35% in payment every month. While a 30 year converted into a 15 year can save thousands of dollars of interest over the life of the loan.

• Change program

You always want to fit your loan program to your purpose and timeline in your house. Changing your program to fit these factors can result in long term savings and security. The rule of thumb is to match your fixed term to the time frame in your house.

• Cash out/Debt consolidation

Using equity in your home is a very common way to manage debt but it should only be used for higher interest rate debt and emergencies.

• Change title

Not as common but a good way to remove a co-borrower or partner.