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Have An Adjustable Rate Mortgage - Need To Remortgage In A Hurry? |
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Submitted by Collette Royal
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Most people are probably aware that interest rates have been on an upward trend. For those who have fixed rate mortgages it does not really matter. But if you have an adjustable rate mortgage, then you may already have seen an increase in your payments. Because these can go considerably higher, it may be a good time to consider getting a remortgage. Here are some tips on how to do it.
Adjustable rate mortgages are definitely the way to go when it comes to getting lower payments - at least it was the way. The problem with this is that they are only good for a limited time. While your payments are fixed at the start, you can't beat it. When it goes to the adjustable part, however, with today's economy, it can become a real nightmare.
Getting a remortgage is about the only solution you have. The quicker that you get it - the better off you will be. If the economy changes for the better in the future, you can always remortgage again.
Ideally, the best time to remortgage is when mortgage rates are more than at least 1% less than what you have now. It is possible, though, that you just need to get a new fixed rate mortgage before you lose the house. If so, then act immediately. One way that you can drop your payment amount with a fixed rate mortgage, is to increase the overall time period of the mortgage. Although it will lower the payments, it will increase the amount you actually will pay in the long run - but it will be cheaper than adjustable rate if rates don't get better. Consider remortgaging again later.
The next thing you need to do is to go online and get some quotes. This is easy to do and you can get more than one quote from a single Web site. But you still need to go to more than one, though, and get several quotes. Then carefully compare them, and see which one will work for you. You should know however, that a fixed rate mortgage is typically higher than an adjustable rate mortgage. That is probably why you went with an adjustable rate - so you could get a bigger house.
After looking at the quotes you receive, you will know two things - if a fixed rate remortgage is within your budget, and secondly, if you will be staying in that house. While that may sound a little drastic, you already are probably experiencing what is happening with interest rates. You have already seen the bills.
If you believe that the new payments sound good to you, you need to sit down and decide if you can make those payments for at least three years. This is how long it will take to recover the costs that will be involved in the remortgage process - closing costs all over again. So, if there is a possibility that you may not want to stay that long, it is not for you.
Finally, determine how much equity you have in the house now. With it, you may be able to get some debt consolidation, which may make getting a remortgage even more worth it.
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