Refinancing is the act of replacing an existing debt obligation with another debt obligation that has different terms. Home mortgage is the most common refinancing undertaken by consumers.
As a homeowner there are plenty of advantages or benefits that you can enjoy if you chose to refinance your Singapore home loan. Firstly you can get fast cash out of the equity of your house, you can lower your rate of interest, you can consolidate debt and you can also ensure that your payments would be stable with the help of a fixed rate loan.
Now, you must be wondering that how would you know whether it is the right time to refinance or not? For this, you can take the help of a Singapore mortgage refinance calculator. This calculator can help you compare your mortgage loan to interest rates and current loan options. It can help you decide whether refinancing would be a smart move for you right now or not. Once you’ve decided that you want to refinance then you can approach us, we would help you out with your requirements.
The next big question is: Is refinancing of Singapore mortgage the right option for me? Well if you decide to go for refinancing with the motive of paying less interest then you won’t be able to see the change right away. Your savings would not increase drastically the moment you choose to refinance, it takes time, and gradually it would increase. The reason being the fees charged by the lenders when you opt for a new mortgage, it is like paying penalty charges for getting out of the old mortgage.
Depending on the time period that you plan to stay in your home, refinancing can be the right option for you. If you are considering of moving out of your place in a couple of years time then it is best to stay away from refinancing because you would not be able to realize the potential savings which you can get from refinancing. The rule of the thumb here is that the longer you stay in your present house, the more beneficial refinancing would be for you!
Of course you’ll also have to take other factors into account before you opt for refinancing. One of these factors is the cost of the new mortgage. A new mortgage comes with a number of charges or fees that the lenders charge such as insurance fees, application fees, origination fees, appraisal fees, insurance costs, legal costs, etc. All these can easily add up to thousands of dollars. Hence you should take these into consideration and figure out whether it is a wise decision to go for refinancing or not. We suggest that you go in for refinancing thinking that these fees would eat up your potential savings. This way you’d be more prepared.