Real Estate Trends Play Role in Minneapolis Refinancing

By Karen Lawson
Local Lender Columnist
Oct 3, 2007
Media ads promote refinancing for everything from new kitchens to lavish vacations. Sure, you'd like to consolidate some bills, and your kitchen could use updating. Should you refinance your mortgage and take cash out? The answer depends on your financial situation, property values in your area and your current mortgage rate and terms.

I owe, I owe: Is Refinancing the Answer?

Most of us would like to put a stop to the high cost of carrying balances on credit cards and consumer loans. If you have equity in your home, refinancing for enough to pay off high cost debts can be a sound financial decision. Also, remodeling can add value to your home depending on the projects you have in mind. It's important to think about the big picture when refinancing, and to compare the actual costs of refinancing your mortgage to the cost of carrying consumer debt. Find out what types of home improvements add value to homes in your area.

Home Equity Provides Cushion against Real Estate Uncertainty

Before refinancing, get a good idea of what property values are doing in your area. Many locales have sustained rapid declines in value. This may be of little consequence if you're not planning to sell immediately, but you want to avoid borrowing too much against home equity. One of the biggest headaches homeowners can have is finding out they owe more on their home than it is worth. Checking with Minneapolis area real estate professionals to learn more about market trends in your neighborhood can help you decide how refinancing can best meet your needs.

About the Author
Karen Lawson is a freelance writer with more than fifteen years of experience in mortgage banking. She holds a Master's degree in English from the University of Nevada, Reno.