5 Reasons to Refinance Your Mortgage

Category: Refinance
Read Time: 2min
Last Updated: 9/10/2021

Imagine getting access to extra cash while simultaneously lowering your monthly mortgage payment. That is exactly what a refinance loan on your mortgage can do. Let’s look at the top 5 reasons for refinancing:

1. Lower Payments

When you purchased or last refinanced your home, your interest rate was determined by the current financial environment and the loan program that you choose at the time. However, interest rates fluctuate. By refinancing your mortgage when interest rates are lower, you can exchange a higher interest rate for a lower one, which will lower your monthly payment and give you more disposable income to pay other bills or put into a savings plan.

In addition, if you’ve enhanced your credit score, your equity, income, or other lending factors, then you may be eligible for a better interest rate.  

2. Cash-out Refinancing

One way to put more money in your pocket is to tap into the equity you’ve built in your home through a cash-out refinance. With a cash-out refinance, you can refinance for an amount higher than your current principal balance and take the extra funds as cash. This can give you money for everything from remodeling your home, paying off high-interest rate bills, sending your kids to college, or reinvesting the equity into other investments.

3. Shorten the Length of Your Mortgage

Another advantage of home refinancing is that you can shorten the term of your mortgage which may save you thousands of dollars in interest payments over the life of the loan. This can allow you to save or reinvest this capital. Also, if the refinance rate is lower you may build up equity in your home faster.


Modern and No Hidden Lender Fees.*

*While Wyndham does not charge junk fees, application fees, processing fees, or underwriting fees, these fees may be charged by a Third Party service provider in connection with your loan. Terms and conditions apply. Rates are subject to change.


4. Private Mortgage Insurance (PMI)

If you were unable to make a down payment of 20 percent when you originally purchased your home, you may have had to purchase private mortgage insurance (PMI). If your house has appreciated since then, and you’ve steadily paid down your mortgage, your equity may now be more than 20 percent. Refinancing may help you remove the PMI and lower your monthly payment.

5. Exchange an Adjustable Rate (ARM) for a Fixed Refinance Rate (FRM)

ARMs make a lot of sense for a large number of borrowers with certain financial goals for a specific period of time. However, as interest rates fluctuate, that adjustable rate will eventually reset to a different interest rate, which is variable and depends upon the interest rates at the time.


With more than 21 years in the industry, we’re a leading fintech mortgage lender saving current and potential homeowners money and time through transparent rates, zero junk lender fees*, and technology that automates over five million tasks each month. We’ve served over 100,000 borrowers, boast a 98% customer satisfaction rating and 4.9 stars on thousands of online reviews, and provide a “mortgages without migraines” experience. (*Note: Wyndham does not charge junk fees, application fees, processing fees, or underwriting fees. There can be fees charged directly by Third Parties for services such as, but not limited to, title, settlement, appraisal, taxes, and insurance.)

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