When is it a Good Time to Remortgage Your Home?
If you pay attention to the media pundits who claim to know something about the state of our economy (and the housing market in particular) then you have probably heard that now is a terrible time to attempt to remortgage your home. For starters, keep in mind that these are the same people who were unable to predict the spectacular plummet of our stock market a couple of years ago (and the “bubble burst” of the mortgage-lending market that preceded it). So maybe you shouldn’t be listening to them. Besides which, they are also saying that the market is finally turning around, so why not think about remortgaging now? In any case, regardless of what the pundits suggest, now is an excellent time to remortgage, for a couple of reasons.
First of all, interest rates continue to remain low, despite rumors of a rebounding economy. So virtually any type of refinancing is going to land you with a better rate than the one you currently have. And although you may have to pay some fees up front in order to secure this change of contract with your mortgage lender, it will pay off over time in a lower monthly payment for the short term and a significant reduction in the overall cost of your property in the long term. But if you don’t hurry to take advantage of interest rates while the prime is held artificially low, then you may miss your chance if the rumors of an upward trend in the economy actually pan out.
However, you may find it rather difficult to secure refinancing in the current market. The mortgage lending institution, on the whole, learned a very hard lesson when the housing market collapsed. Some industry leaders toppled or were bought out by others because of their inability (or unwillingness) to properly screen candidates for loans in the years leading up to the crash. For this reason, many lenders have become wary about handing out loans. In addition, they may not be interested in setting up refinancing for someone who is making all of their payments on time and in full. In short, you may be punished for having a clean record. Of course, you can always hedge your bets by threatening to refinance with another lender (who would no doubt be more than happy to secure a paying customer with your credentials).
Of course, this also means that if you have gotten a bit behind on payments, you may actually have an easier go of it. The goal of any lending institution is to recoup their costs (and then some). So if you are struggling to pay, it is in their best interest to see that you are able to secure a plan that you can afford. While keeping you in your home is certainly not their first priority, getting their money is. And asking for refinancing that will ensure you are able to pay off the loan is a pretty good way to remortgage your home now, while interest rates are tipped in your favor.
Sarah Danielson writes for Policy Expert where you can find public liability insurance quote and browse through various policies to find the right one for you.
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