Refinancing California Mortgage Loans – How Does a Refinance Work?
Many homeowners are opting for a mortgage refinancing to obtain a better mortgage rate, shorten a mortgage term, or acquire extra cash. Prior to completing a refinancing application, homeowners must understand the process and know what to expect. Here is a quick guideline on how mortgage refinancing works. What is a Mortgage Refinancing? If selecting to refinance an existing mortgage loan, homeowners apply for a new mortgage, which pays off and replaces the old. Thus, homeowners have the opportunity to obtain a new mortgage lender. Each lender offers different home loans. Initially, homeowners may have received a bad mortgage loan. Refinancing presents the perfect chance to get out of a bad loan, and attain a mortgage loan with better terms. Requirements for Refinancing There are minimum requires for refinancing a home loan. However, to benefit the most from a refinancing, the new mortgage rate should be at least two points below your old rate. If a rate reduction does not occur, it’s
