You can earn a lot of money by transferring your mortgage or loan cheaply. Refinancing a loan or mortgage reduces monthly costs. The savings mortgage is probably an exception to this. Request different quotes for refinancing a mortgage. The banks are fighting for customers who want to refinance their mortgage. So refinance and refinance.
Lower mortgage interest rates provide opportunities
You must also actively monitor the development of mortgage interest rates with your mortgage. Granted, you usually take out the mortgage for many years, but that does not alter the fact that you can earn a lot of money by refinancing your mortgage in the meantime. Of course, there is a moment just before you extend your mortgage when you receive an offer from your own bank to extend your mortgage. That is also refinancing, but I mean refinancing sooner and with lower monthly costs. You do this by taking advantage of the lower mortgage interest rate and transferring it to the bank where you are now, or to another mortgage bank or lender.
Bank competition is fierce when refinancing a mortgage
The banks are cautious about granting a new mortgage, but when your fixed-rate period expires they are all interested. You already had a mortgage and so it is important for the bank to bring you in. Request quotes and benefit from this competition among banks.
Advantages of transferring a mortgage
The biggest advantage is the lower monthly costs, but it is also the time to leave your bank if you were already not very satisfied with the bank. Transferring loans to a higher mortgage amount is usually also possible with a lower interest rate. With the higher mortgage you can pay off other loans, while paying less monthly. You will achieve the greatest benefit if, for example, you pay off your overdraft at the bank with a higher mortgage. If you overdraw at the bank, you will soon pay 15 percent interest. With a mortgage this is much, much lower. So on balance you will make progress.
Is refinancing a mortgage beneficial?
Refinancing a mortgage is advisable if the mortgage amount is the same, as this will reduce the monthly costs. So let the bank or lender identify all the costs you have to pay to transfer the loan or mortgage. Any penalty interest, administrative charges, any notary fees or other costs. Then you will see that the monthly costs are lower, or will be lower within a few years. In that case, refinancing is highly recommended. The penalty interest that you may have to pay is fully tax deductible and can be recouped within a few years.
You will benefit from it for many years to come
The success of refinancing a mortgage is generally for the slightly longer term. After all, you pay a penalty interest that you have to recoup in the following years. Because the penalty interest is tax deductible, you can quickly earn money from this, although how quickly depends mainly on the mortgage and the fixed interest period.
Take out a savings mortgage
Then the savings mortgage. With the savings mortgage, you should not only look at the mortgage interest, but at your total monthly costs. That is, taking into account the savings part of the mortgage. With this mortgage you save in a blocked account at a savings interest rate that is as high as the mortgage interest rate. What you gain on your mortgage costs if the interest rate is lower, you lose on your savings portion. Especially if you have had a mortgage for years, the savings portion has already become a considerable amount and a lower interest rate will work to your disadvantage. The advantage on one side is then canceled out by a disadvantage on the other side. In that case, refinancing the mortgage is probably not wise. But also with the savings mortgage, it is best to ask for different quotes to see how things work out. Then look at the mortgage part and the savings part together to see whether refinancing is wise. If you have built up capital, there is an additional advantage: a lower interest rate because you are in a lower risk class than when you took out the mortgage.
Refinancing a mortgage usually only has advantages with a lower interest rate. An exception may be the savings mortgage. Always request sufficient quotes. After all, you never know, you may be given a much better offer than you expected.
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