Posts Tagged ‘Loan Refinancing’

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Florida Home Equity Loans – Refinancing a Home Equity Loan

April 14th, 2010



During the last five years, Florida home values have practically doubled in cities like Orlando, Miami, Tampa, Ft. Lauderdale, Clearwater, and Sarasota. Many homeowners reaped the benefits during this time and borrowed from the equity in their home. If you are part of this crowd, now may be a good time to consider refinancing your Florida home equity loan. While refinancing may not be right for everyone, it can be very beneficial to some. Good reasons to refinance include:

Better Interest Rates

Interest rates in the state of Florida are constantly changing. If you took out a fixed rate home equity loan while rates were high, or if you now have better credit, refinancing your Florida home equity loan could save you a lot of money. You’ll have to be very careful though. Lower monthly payments may not offset closing cost fees. For example, if your closing costs come to $3,000 and you save $100 per month, it will take you 30 months to break even.

Avoid a Balloon Payment

Taking on a Florida home equity loan that has a balloon payment can save you money in the beginning of the loan term, but coming up with that final balloon payment can be difficult. Refinancing your home equity loan will allow you to avoid the balloon payment altogether.

Extract More Equity Cash

When dipping into your equity, it can be very hard to determine how much money to borrow. If you didn’t take out enough the first time around, refinancing your Florida home equity loan will provide all of the benefits mentioned above and allow you to extract a bit more cash from your equity.

By: Jane Hale

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When Is The Time To Refinance Commercial Loans?

March 22nd, 2010



Businessmen usually borrow money for long periods. Since the nature of business requires a long term investment, it becomes important for a borrower to seek long term financing. At the same time, it is very true that you cannot predict the market behaviour over a long period of time. The fluctuations in the interest rates do keep on taking place.

If you have taken a loan when the interest rates were high then you are losing money because of the prevailing low rates. In such situations, the solution lies in refinancing a loan so that you get the benefits of lower interest rates. This is the right time to opt for refinancing. Besides, you can also seek this remedy to change the terms and conditions of your loan plan as you may no longer be comfortable with them after few years.

If your existing lender is willing to refinance your commercial loan, it is fine. Otherwise, you can opt for commercial loan refinancing from a new lender in the market. After all, your interests should not be subjected to the whims of a caprice lender. There are several benefits of this commercial refinancing. They are as follows:

1. Reduction in your four-weekly installment: If a commercial refinance is correctly done, it will definitely reduce your four-weekly installment by minimum of few hundred pounds. This reduction will ease some financial burden from you and at the same time you will be able save some money. However, you should correctly do all the calculations before deciding for such options.

2. Can bring more flexibility: At the time of taking commercial refinance, you can increase or reduce the number of payable instalments. Depending on your present financial conditions, you can increase or reduce the number of instalments.

3. Can convert adjustable loan to fixed loan: Similarly, at the time of commercial refinance you can also convert the adjustable loan to the fixed rate loan. By doing this your repayment tension will definitely come down. Thus, you will not require worrying about the future rates and you will have to pay a fixed amount per month.

4. Consolidate your debt: The one more benefit is that you can consolidate your entire debt burden and get relief from burdensome interest payments.

The facility for refinancing commercial loans is available with many lenders in the UK. You should try to make most of this opportunity, but not before you have assessed the situation rightly.

By: Samantha Bonsu

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Refinancing In And Out Of Balloon Loans

March 17th, 2010



Let us analyze these two scenarios.

Balloon loans are mortgage loans that require you only to pay for the interests (and sometimes a small portion of the capital) till the end of the repayment program. Once the loan term finishes, you are required to put down a lump sum that is usually equal to the whole loan capital or a big part of it.

These loans are perfect for those who can not afford high monthly payments but from time to time have high incomes they can put aside into a savings account to cope with the lump sum payment when the loan term ends.

Refinancing Into Balloon Loans

Knowing what balloon loans are you can probably imagine in what situations it would be advantageous to trade in your outstanding mortgage loan in exchange for a balloon loan. Since balloon loans charge only small monthly payments, if you can no longer afford the monthly payments on your current mortgage due to being unemployed or due to any other unexpected circumstance that reduces your income dramatically, it is a good idea to refinance and obtain a balloon loan .

With the balloon loan you will be able to repay your current mortgage balance and obtain small monthly payments in return. You should bear in mind that even though the payments will be affordable, this loan requires a lot of discipline and the eventual recovery of your saving ability. Otherwise, when the time comes and you need to pay off the loan’s remaining balance, you may not be able to do so and you may risk repossession of the property.

Refinancing Out Of A Balloon Loan

If that happens or you just need a few years of low payments or you are currently on a balloon loan reaching the end of the repayment program and you fear that you will not be able to save enough money for the lump payment, it is time to refinance out of your balloon loan. By doing so, you will replace your current loan with a regular home mortgage loan with a longer repayment program.

This of course will imply that you will have higher monthly payments for a period of up to 20 years. You will have spent a lot of money in terms of interests with plenty more to pay over the whole life of the loan but you will get to keep your property and eventually fully own it when you repay the whole loan.

Refinancing out of a balloon loan is essential if you can not cope with the lump payment. In order to turn the transaction less expensive, if you do have savings, you can use them to make higher monthly payments and reduce the length of the new loan.

By: Jess Peterson

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