"When you have been paying installment for a long time and feel that it isn’t worthy installment because interest is increase higher and higher until you think that you can’t pay installment anymore and you want to keep your house or see a better offer, refinancing is the interesting choice for you."

What is refinancing? Its simple meaning is the creditor changing by takes the money from new creditor to pay old debt for less interest and able to pay debt installment. It might be the case of from the bank to another bank or same bank in better condition of interest by use the same collateral property.

Cause of refinancing There are 2 major cause that see the better chance and condition in interest and want to rest to manage and organize whatever about finance.  The first reason should be done in the case of interest of housing loan is much cheaper than the old one. It will help you save the expense in long term for many years. And the refinancing to organize things about finance tends to cause from a lot of debt and borrower want to pay the house’s debt per month fewer and take the differences in spending.

Both cases will be worthy if it is the less paying in long-term only. If you can clear off the debt within 1-2 years, you should not refinance.

How to refinance It is same as request a new loan both document and procedure. Expense in refinancing is divided into 3 expenses following

  1. Expense in previous financial institution such as fine in the case of redeems the collateral property before due. Generally, the term is 3 years since the request loan date and fine is about 2-3% of debt.
  2. Expense in new financial institution such as charge of collateral price appraising, fee of constant interest rate using and fee in fire insurance to prevent risks. If you still have old insurance, you can cancel the benefit transferring to previous financial institution and change the new financial institution to be benefit receiver.
  3. Expense in department of lands such as mortgage charge 1% of loan and revenue stamp fee 0.05%.

By : TerraBKK.com