Reports suggest that the real estate market is gradually recovering but at a snail’s pace. There are frequent upheavals and this is evident from the RECI or the Real Estate Confidence Index which keeps track of views and opinions of real estate agents as well as brokers and their “forward-looking” sentiment of United States’ real estate market which recorded 5.59 in October as compared to 5.83 in September. As rates are still low, home refinance is an option that majority of the homeowners are turning to. Some are also taking help of loan modification. It was observed that properties that ranged in between the low and mid priced ranges kept the real estate as well as the mortgage market active. The mortgage market which is still volatile is yet to recover fully and statistics suggest that about 6.7 million households in the US having mortgages have fallen behind on payments (as per MBA or Mortgage Bankers Association). Every homeowner is striving hard to become current with their payments again so that they don’t lose their home in foreclosure. One of the best ways to save your home from being foreclosed is to opt for home refinance and that is what majority of the homeowners are doing if it is an appropriate choice for them. What do you mean by an appropriate choice? There are many factors that decide whether or not the time is ripe to opt for home refinance. When should you refinance your mortgage? Some of the factors that help you to decide whether you should refinance your mortgage are as follows – Opt for home refinance when rates are low Low rates can drive you to opt for home refinance. This is what majority of the homeowners do. This can make your mortgage payments affordable. Weigh the short term and long term benefits Find out how refinancing your home will affect your long term as well as short term financial goals. Do you want lower monthly payments and reduced interest rates? Home refinancing will allow you to enjoy lower payments and reduced interest rates. Do you want to switch from adjustable-rate mortgage to fixed-rate mortgage? Often it is seen that homeowners refinance if they are currently making payments as per adjustable-rate mortgage but want to switch to fixed-rate mortgage that makes their payments predictable. This is advantageous as you can plan out your finances well in advance. Are you looking forward for some extra cash? If you have enough equity in your property, you can opt for home refinance to get access to some extra cash that can be used for meeting your other financial obligations. Build up equity in your property Home refinance is also a good option if you want to shorten the length of the loan term. Homeowners usually do so in order to pay off mortgage faster so that they can build equity in the property faster. If you are planning to refinance your mortgage, do so only if it is beneficial for you. It is important that you don’t opt for home refinance only if one of the factors mentioned above match your requirements. This is because whether you refinance your mortgage or take out mortgage for the first time, you are putting your home at stake. Guest Blogger: Peter Gomes