Is it Possible to Refinance Other Loans?
Refinancing isn't just for home loans/mortgages. No matter what kind of loan you have, it can likely be refinanced. Different loan types have different rules and procedures for refinancing, but the premise is basically the same- to reduce interest and monthly payments. Here, you will learn about the other types of loans that can be refinanced.
- Car loans have interest rates that vary depending on the lender and the credit history of the borrower. It's important to research ahead of time to find the best rate, as opposed to using the lender that the dealer recommends. Refinancing a car loan can save a lot in monthly payments and over the term of the loan. To refinance an auto loan, the borrower should gather information from competing lenders such as credit unions and banks.
- Investment property. When trying to refinance this type of property, there are many factors to consider. Banks usually want more equity on an investment property; sometimes as much as 50%. When attempting to refinance an investment property, interest rates are normally higher and so are points.
- Short refinance. It's a tool that is sometimes used to avoid foreclosure. The lender offers the short refinance in a last-ditch effort to mitigate their losses. This type of refi may adversely affect the borrower's credit, but it won't cause as much damage as a foreclosure would. Lenders lose money on short refinances, but the total is still less than with a foreclosure.
- Student loans. This can be a great way to save on interest and reduce the monthly payment; refinancing is also referred to as consolidation where student loans are concerned. If you took out one or more loans for college, they likely have different lenders and interest rates. Refinancing your student debt can put all those loans in one place, with one lower interest rate. Refinancing student loans is easy, as is the application process.
