Owning a property is one of the greatest signs of achievement in this country. But that achievement comes at a price. What are we talking about? Your mortgage. We know it's difficult to pay off, whether the economy is in flux or whether you struggle with poor credit. But for any homeowner, a mortgage doesn't have to be a prison sentence. Here's how to make it a much simpler obstacle to hurdle.

Home refinancing can be a really good option once your first loan is paid off in order to create a new mortgage with an adjusted interest term and rate. There's just a few things to consider before refinancing, because it might not be beneficial in all situations. That's why we trust LendingTree, a company that finds you great deals on loans, to get you on track to a better mortgage.

Here's how it works. Simply log onto their site and go to home loans and "Refinance." Enter the type of property you own and click to view your free offers. Then, answer a few questions about how you use your property, your zip code, the property value, the remaining 1st mortgage balance, and whether or not you have a second mortgage (and remaining balance). Then, enter how much additional cash you'd like to borrow as well as your credit score, and a bit about your personal financial history to receive information on pre-qualification for home refinancing. It's as straightforward as that!

LendingTree offers much more than just feedback on your eligibility for home refinancing, but also includes a mortgage calculator, home affordability calculator, refinance calculator, and refinance payment calculator. They also provide useful resources on mortgage and refinance rates and mortgage lender reviews, so you can educate yourself about how to best continue on your road to getting that mortgage paid off for good.

Home ownership is a huge responsibility, and mortgages can often seem burdensome if they were poorly negotiated. However, LendingTree is there to provide assistance in helping you refinance your home in a simple process.

Update: Follow this link to find out more about home refinancing with LendingTree!

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The Federal Reserve sets the guardrails for the federal funds rate, and through that helps control the money supply for the nation.

When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.

A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.

One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.

The Federal Reserve The Federal Reserve


The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.

This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.

The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.

Getty Images/Maria Stavreva

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