There are many compelling reasons to refinance your home loan. Here are the top five:
1. Lower your monthly payment
You can lower your monthly payment by lowering your interest rate and/ or stretching out your mortgage tenure over a longer term. For example, you can
2. Lower your interest rate
Refinancing to a home loan with a lower mortgage can immediately reduce your monthly payment and the amount of interest you pay.
Zoe has a $300,000 mortgage at 4% p.a over 20 years. She enters these numbers into the refinance calculator. If she refinances her loan to 1.20% p.a. Her new monthly payment will be $1406. This is $412 less than her existing one.
3. Pay your mortgage off faster
Your income has since improved when you first took out the mortgage. How about refinancing your loan from 25 years to 20 years?
4. Change your variable interest package to a fixed interest package
Perhaps the interest rate of your variable interest package has gone up every adjustment period and your are concerned the trend will continue. Why not refinance your loan to a fixed interest package? A fixed interest package will prevent you from being affected by rising interest rates and allow you to budget your payment with certainty.
5. Cash out on your home equity
If you need cash to pay for your kids university expense, renovation, start a business or consolidate debt, or for any other reason. You can consider a home equity loan. This involves in getting a new mortgage in additional to what your currently owe. You must use cash to service the home equity loan, CPF is not allowed.
How do you know you are ready to refinance?
moneyiq.sg’s refinance calculator is created to help you compare your current mortgage with available packages in the market. You can use it to find out if refinancing helps you to lower your monthly payment, pay off your loan faster and compare the difference on a fixed package.
When you are ready to refinance, submit your request to moneyiq.sg
For privacy reason, we will not be collecting any confidential documents from you. Our bankers will get in touch with you directly. You can feel confident and secure about getting a good deal.