Refinance Bi-weekly To Speed up Mortgage Repayment!

If you can’t wait to become debt free and feel at ease knowing that you own your property completely, you can refinance your home mortgage and elect to make payments on a bi-weekly basis. Thus, you’ll be accelerating your repayment program and sooner than you think you’ll cancel your mortgage loan completely.However, you should analyze this alternative thoroughly to see whether you’ll be able to afford the payments without sacrifices. Remember that mortgage loans carry the risk of repossession with them and there is always a possibility to loose your property in case you can’t afford the monthly payments and you default on your loan.Consequences of Different Repayment ProgramsWhen refinancing, you can select the repayment program that best suits your needs and budget. Every modification of any loan term has consequences on the rest of the loan terms. The variables that define the loan characteristics are all related and are specially modified by the risk variable which outlines most of them.Thus, by extending or shrinking the mortgage repayment program, you will be affecting the rest of the loan terms including the interest rate, the monthly payments and sometimes even the loan amount you can request if you are trying to get a cash-out refinance mortgage loan. Thus, be aware of this and do not go too far with your requirements.Bi-Weekly RepaymentsThese repayment programs imply an average of two payments each month which in turn tend to reduce the length of the loan by up to 50%. With such programs you can become debt free and fully own your property in half the time it would take you to do it with a regular repayment program for the average mortgage loan.However, you need to be sure that you’ll be able to afford the monthly payments. It is not strange to see people closing on these deals and then having to refinance on a bad stance due to not being able to meet the loan payments every two weeks. Thus, make sure that you’ll be able to afford them even if unexpected expenses arise. Don’t compromise all your income with the repayment of the loan as little extra expenses always occur, and bigger ones, though not always, do occur often.Risk Of RepossessionThe above is not a mere warning, you need to be especially careful when refinancing a home loan because home mortgages carry the risk of repossession with them. And this is a legal process that will deprive you from your property in order to cancel the debt that the asset guaranteed.In the event of default, the lender can force you to hand in the property that will be sell so the lender can collect the amount needed to repay the money owed including all the interests fees and legal costs. That’s the reason why you should never risk refinancing for a higher amount or higher monthly payments when you are not completely sure that you’ll be able to afford the loan repayment even if something unexpected happens.