How Refinancing Your Mortgage Could Work for You

Save money - refinance your mortgage

When you were younger, you thought your student loan was the biggest decision you’d ever make. Fast forward a few years, and you’ve made a lot more substantial choices, including buying a house and taking out a mortgage. Faced with this decision, all those other choices pale in comparison. Yes, it’s no exaggeration to say that taking out a mortgage may be the biggest decision anyone makes in their life, certainly their most prominent financial decision up to this point.

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You’re a safe investor, so you do your research. You find a reputable lender, read the T&Cs, and customize the terms exactly to your specific financial goals and requirements. Excellent. Except for one thing. For the vast majority of people, those all-important requirements and goals that existed when they first purchased their home have changed over the years. Suddenly, your mortgage loan isn’t as picture-perfect as it was on signing day. From the interest rate you were given (which sounded reasonable at the time) to your financial standings and repayment terms, things have certainly changed over the years.

Out of luck? Hardly. This is where mortgage refinancing comes into play. Mortgage refinancing services help you get a better deal for your mortgage loan than the original one. Wondering if refinancing is the right move for you? Check out our guide to refinancing for everything you need to know, including the pros and cons of refinancing mortgages, what it takes to refinance, and where to go next.

How Does a Refinance Mortgage Work?

If you’re new to the field, you might be wondering how a refinance mortgage works anyway? To someone who hasn’t refinanced their home, it can be an intimidating concept. You don’t want to mess with a good thing (i.e., your current loan), but you like the idea of upgrading and possibly even saving money (more on that below). Luckily, the entire experience can be quick, simple, and even pleasant if you go with the right mortgage refinancing services.

So, how does a refinance mortgage work? It’s actually easier than you would think. Since you’ve already taken out a mortgage loan, you are already familiar with most of the steps involved because taking out a refinance mortgage is almost the same process as taking out a regular mortgage loan. The basic steps include:

  • Start with a little comparison shopping

Make sure to look around for the best rates and loan terms possible. After all, you’re doing this to make money, one way or another. So be sure you are getting the best deal for your mortgage. Opt for an industry leader like SoFi, Even, or Marcus so you know you’re dealing with a reputable and reliable mortgage refinancing service. The most important things to compare are interest rates and repayment terms against your current rates and terms.

  • Apply for the mortgage refinancing loan

This step is already familiar to you, since it’s pretty much the same as the first time around. You’ll need to fill out a basic application form, provide some documentation, and have a credit pull done. The good news is that since many people improve their credit over the years of owning a home (by paying off their mortgages responsibly and in a timely manner each month), you are more likely to get approved for a better rate than you received previously.

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