new loan to lower my interest rate

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I was suggested for a new mortgage in order to get my interest rate lowered. Is there any requirement for a new loan to lower my current rate?

blue · Posted: Tue Nov 29, 2005 11:26 am Post subject:

Hi Spice,

You can go for new refinanced loan which allows prepayments without penalty. Afterwards you can make larger monthly payments to pay off the loan earlier.

The interest rate on the new loan will be much lower than the existing rate.

Regards,
Blue

Samantha · Posted: Tue Nov 29, 2005 12:31 pm Post subject:

Hi Spice,

In case it is a fixed rate mortgage then you need to take a new home loan at a lower rate to pay off the earlier mortgage as the fixed rate mortgage do have a number of legal documents which generally does not allow to reduce the interest rate.

If your existing mortgage has an option to modify the terms, then you may compare the revised terms with the current refinance rates and costs before you decide for the modification.

In some instances a new refinance can be a better alternative then a modification or revision of rate.

Hope you got your answer. In case of further doubts feel free to post here.

God bless you.

For MortgageFit,
Samantha

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