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A Beginner’s Guide to Refinancing

A Beginner’s Guide to Refinancing

By Homeland Lending, Posted in Mortgage Advice
On August 09, 2018

Deciding whether or not to refinance your home loan is a serious decision, and it can be confusing. This blog aims to help shed some light on the pros, cons, and intricate details involved in refinancing your home.

Why and when?

Why do you want to refinance? Determining what the goal of refinancing is, and whether it’s the right time for you, are the very first steps. In certain cases, refinancing could save you money — but it’s important to research all the details. Below are some pros and cons that every beginner should consider before refinancing a mortgage.

Pros and Cons


The number one reason to refinance is typically to obtain a lower interest rate than what your current mortgage loan offers. By locking in a lower interest rate, you can save money both overall, and on a month-to-month basis.
You can switch from an ARM (adjustable rate mortgage) to a fixed-rate mortgage. This is helpful if you want your interest rate to permanently stay the same, instead of fluctuating with market trends. With a fixed-rate mortgage, your interest rate will stay the same for the entire life of your loan.
Cash-out refinancing is another common reason that people choose to refinance. If you’ve built up equity in your home, there are refinance options that involve turning your equity into cash. This can be used for a number of things, including to pay off other large debts, but a popular use is for home improvements and renovations.
Similarly, there are other programs which allow you to combine other debt, like credit card debt, for example, into your new loan.


  • In some states, you can incur a penalty for paying off your original loan early. Research the laws in your state or enlist the help of a mortgage professional before making any decisions.
  • Remember that refinancing means you are taking out a new mortgage. Taking out a new mortgage means you can incur new closing fees and other unexpected fees up-front. If saving money immediately is your goal in refinancing, this may be an important factor to consider.

Pro tip: Don’t choose and bank or mortgage company that demands an appraisal charge up-front. A lender’s first step should always be to review your particular situation and all of your documents, and to then approve you for a loan, before asking for an appraisal fee.

By choosing the right mortgage professionals as your partners, you’re sure to make the right choice when it comes to refinancing your home loan. If you need advice, give us a call at 201-808-8181 today, or visit to learn more.

Homeland Lending

Homeland Lending

Homeland Lending is a full-service mortgage lender and brokerage. We provide the most consistent, attentive, and personalized mortgage solutions to help you secure your dream home - and there's never a catch.