Part of the nBuy Life Event Network

Our home planning centers: 

Home Refinancing Guide

what you need to know
You may be refinancing your existing home into a lower, better term mortgage loan ... or maybe for some other reason. Refinancing your home requires the same steps and approval as purchasing a home.


Page Topics :

  1. reasons why homeowners refinance
  2. cash-out options and supporting guides
  3. APPLY NOW | or call 1-877-777-1370
  4. lender shopping sheet and checklist
  5. mortgage financing map
  6. FREE: loan calculating worksheet

Click a topic heading to toggle the display of its contents | hide all | show all

Reasons Why Home Owners Refinance

To Find a Better Rate

The key reason why home owners refinance their mortgage is to lower their current rate. Current refinancing rates have dropped substantially. Homeowners that refinance at lower rates can cut their monthly payments.

Compare your mortgage rate with current refinancing rates:


Refinancing your home can cost you

Refinancing a home comes with cost — mainly in lender origination fees and closing costs. Most lenders tack these additional costs on the new mortgage loan that you will be assuming.

For example: lets say that amount you still own on your current mortgage loan is $100,000.

So when the lender refinances your loan, they will underwrite a new mortgage loan to payoff your current mortgage loan balance. But the lender may charge an orgination fee of 1%; plus you may incur points and closing cost of a approximately 4%. So your total costs to refinance may be $5,000.

Lenders will tack the $5,000 to the original payoff amount to give you a mortgage loan of $105,000. This practice is usually referred to as no-cost refinancing. In other words, there is no out-of-pocket costs to you to refinance.

You can of course pay those fees out-of-pocket. But most homeowners choose to tack the fees onto their refinancing amount.


Your new rate should be 1-2 points lower than your current rate in order to benefit:

meaning that you need to lower your rate by 1-2 points in order to recover the costs of refinancing.

If you new rate is less than 1-2 points from your current rate, you will pay more in refinancing if you just stick with your current mortgage plan.


There are other reasons why you may refinance instead of just getting a lower rate.

These other reasons include:

  1. Get Into a Stable Mortgage Product
    homeowners with payment-risk mortgages such as adjustables, interest-only, minimum payment plans, and other high-risk mortgages will refinance into more stable, fixed-rate mortgage loan.

    These homeowners may have used these higher risk mortgages to get into their first home. Now that thier financial situation has improved, and that the rates on fixed-mortgages have declined, now is the time to get into a mortgage loan product that carries little risk.

  2. To Arrange Better Payoff Terms:
    homeowners may want to shorten or lengthen their payoff terms depending on their financial situation.

    For example: homeowners in 30-yr mortgage plans may want to refinance in a 15-yr or 10-yr mortgage plan in order to pay off their mortgage faster. Likewise, homeowners who want to lower their current mortgage payment may refinance their current mortgage loan out to another 30-yr term.

  3. To Get Some Cash Out:
    many homeowners will refinance their home mortgage to take extra cash out for home improvements, debt payoff, college education, auto buying, and other.

    They will refinance at a higher mortgage value to repay their existing mortgage loan and take cash out for need expenditures.

top of page

Refinance Cash-Out Options

Remodel Your Home:
Use the extra cash to remodel the kitchen, bathroom, attic, and other. Capture ideas and plans for starting your project. Use our complete directory of ideas and remodeling tools:

info: click for home remodeling ideas
info: click for home remodeling 6-step plan
info: download home remodeling spec sheet
    note: links will connect to affiliated web site

Make Home Improvements:
Use the extra cash to make home improvements and buy home decor:

main floor:
  ex home:
    note: links will connect to affiliated web site

Consolidate Debts:
Use the extra cash to consolidate and payoff high interest rate card and other debt:

info: credit card debt reduction guide
info: personal loan debt reduction guide
info: click for debt management
    note: links will connect to affiliated web site

Budget Management
learn about budget management and bills reduction:

info: understand budget management
info: link to our Budget worksheet
info: online tips for lowering monthly costs
    note: links will connect to affiliated web site

Ideas to Increase Income :
Use the extra cash to advance your education or strengthen your career. There are four ways to increase your income:

  1. Go Back to School
    you can go back to school to increase your education or skill levels for higher income pay:
    visit our education planning center for programs

  2. You can Change Jobs or Career
    you might consider a job or career change to increase your pay -- learn what it takes to find the right company and job:
    visit our career planning center for ideas

  3. Start a Home Business
    the new economy allows for micro businesses from the home -- use the latest in internet technology to reach your customer:
    visit our Home Business Center for ideas

  4. Buy an Established Business
    go ahead and become a small business owner -- buy an established business that you can manage and grow:
    our Business Brokerage Unit can help
note: links will connect to affiliated web site

Pay for College:
Use the extra cash to pay college expenses for your child or yourself. We operate an extensive college planning center for HS students and graduates:

guide: senior college planning guide
guide: junior college planning guide
guide: graduate school guide
guide: college prep guide
    note: links will connect to affiliated web site

Build a New Home:
Use the extra cash as a down payment to build a new home. Capture ideas and plans for starting your home construction. Complete online directory:

info: go to our Home Construction Center
info: download home construction spec sheet
info: click for home building checklist
info: click for home building 7-step plan
    note: links will connect to affiliated web site

Take Some Travel:
Use the extra cash to travel the world. We have discount travel programs on air, lodging, tickets, last minute deals and more:

tips: go to our Discount Travel Center
tips: last minute travel deals
tips: click for discount cruises
tips: click for vacation specials
note: links will connect to affiliated web site

top of page

What's in the News