MORTGAGE REFINANCING: Tips on mortgage refinancing benefits
Mortgage refinancing is a perfect financial saving scheme to gain extra cash for people who want to pay off their old mortgage with new home mortgage refinancing loan amount. Refinancing mortgage releases funds to take care of immediate personal needs. Mortgage brokers however, serve as good resource or medium for locating competitive bids from wholesale lenders.
Mortgage refinancing loans are sourced from institutions such as thrift societies, banks, credit unions, mortgage companies and mortgage brokers. However, we should be cautious with mortgage brokers protected by the loopholes in mortgage refinancing disclosure laws, who close loans in their own names. These categories of mortgage brokers are not compelled to disclose their mark-up on the primary loan interest rate from wholesale lenders.
Mortgage refinancing offers some great benefit to borrower such as;
1. Mortgage refinancing gives the borrower option to pay originating fees and close cost from wholesale refinancing lender.
2. It also gives the borrower opportunity to reject yield-spread premium (YSP) yield spread premium is the mark-up on interest rate offered by wholesale mortgage refinancing lenders which qualifies the mortgage brokers for bonus on the overcharge.
3. Low interest rate: A major advantage of mortgage refinancing scheme is the benefit of lower interest rates that reduce the monthly mortgage payment considerably. The mortgage refinancing release surplus amount of cash due to the lower interest rate offered by the refinancing scheme to enable individuals explore other investment opportunities for better return.
4. Mortgage refinancing scheme give the borrower the opportunity to switch from fixed interest rate to adjustable interest rate regime. This refinancing arrangement makes loan repayment friendly, convenient and more cost effective.
5. Mortgage refinancing loan interest is tax deductible: Interest paid on mortgage refinancing is tax deductible unlike interest on other bills. Therefore refinancing your mortgage can give you a considerable edge to pay off you bills.