Mortgage Refinance

A mortgage refinance is a financial agreement by which you can release the equity you have in your home. If you go comparison shopping to find a suitable lender, you may possibly succeed in getting a mortgage refinance to enable you to retain your sweet home and also reduce your monthly credit bills by around 40%. This is quite a substantial saving which you can use to further reduce your loan liability. Alternatively, you can also make cash purchases of the much needed items at cheaper rates, which otherwise you might have purchased through your credit card at higher rates plus substantial interest charges.

There are many types of mortgage refinance plans. Given the large number of options, you may select the one that suits your interests.

One option is the Variable Rate Mortgage. According to it, the interest rate that you pay may vary according to the prevailing financial climate. Also, your monthly payments will obviously be determined by the prevailing rate of interest.

The second type is the Discounted Rate Mortgage. It includes the Variable Rate Mortgage with the proviso that the lender will pay discount on the basic Variable Rate for a specific period after which the interest rate would again revert to the lender’s standard variable rate.

The third type is the Fixed Rate Mortgage. This means that your interest rate will remain stable for a certain period and your monthly payments will not change during that period. After the expiry of the specified period, the interest rates will again become variable for a certain period after the expiry of the fixed rate period.

The fourth type is the Flexible Mortgage. This type enables you to vary your mortgage payments, but the terms of Flexible Mortgage vary from lender to lender. You can also make lump sum payments, over payments, under payments according to your convenience but subject to the terms and conditions of the lender. Under this plan you can even take repayment holidays also.

The fifth type is the Base Rate Tracker Mortgage. According to this scheme the interest rate will be linked to the base rate and will fluctuate with the changes in the base rates.