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Look into the past and remember what implied your first mortgage loan. Mortgage refinance loans is quite a similar one, the difference is that you have the house so you’ll won’t go anymore through a pre-approvals process. You’ll thus save a lot of paperwork.

Does refinance always mean lower interest rates?

Home refinance mortgage rates are supposed to be lower, but still there is a possibility it will not be. If your credit score is now a bad one, and at the buying you had a clear credit history, don’t be surprised to find out that a refinance won’t suit you at all. A bad credit mortgage refinancing comes always when there is a great need of cash, but this refinance is not at all supposed to lower the interest rate. So mortgage refinance quote was thought to be lower in order and of money over the life of the loan was supposed to be saved. But things does not always are what they were meant to be.

In order to get the best loan possible , you should firstly pay a visit to you current lender. It is his interest to keep you as a client and will try his best for that dealing and negotiating in good terms for both parts. If your current lender can’t get you the best refinance rate, contact other lenders about refinancing with them. Your goal is to find the best rates with the lowest fees and closing costs (without adding those fees to your loan balance).

What’s a second Mortgage loan?

2nd mortgage refinance loan refers to the fact that Americans were allowed, due to a government measure, to make a second mortgage on the same house, the principal index of this equation being equity. Equity represents the difference between the value of a property (as defined by the market) and the claims held against it; for example, if a piece of property worth $800,000 has a mortgage on it for $300,000, the equity would be $800,000-$300,000, or $500,000.

As the equity was the only asset at that time, this loan helped a lot of Americans in need.