Weighing the Options of Refinancing
 |
 |
 |
Shopping for a mortgage loan? We'll be glad to talk about our many mortgage solutions! Give us a call at 866-300-1550. Ready to get started? Apply Here.
|
|
|
|
|
Some have said that only when your new interest will be at least two points below your current rate, should you refinance your loan. That may have been true years ago, but with refinancing dropping in cost recently, it's never the wrong time to consider a new mortgage! A refinanced mortgage is often worth its cost several times over, considering the benefits that can come, in addition to a reduced interest rate.
Advantages
When you refinance, you might have the ability to reduce the interest rate and monthly mortgage payment amount, sometimes by a lot. You might also have the ability to "cash out" some of the built-up equity in your residence, which you can use to take care of higher interest debts, make home improvements, or plan a vacation. With lower interest rates, you might also get the chance to build up home equity more quickly by changing to a shorter term mortgage.
Fees and Expenses
All of these benefits do cost something, though. You'll be charged the same types of expenses and fees as you did with your present mortgage loan. Among these can be settlement costs, an appraisal, lender's title insurance, underwriting fees, and so on.
Do the Math
Paying points can help you get a lower interest rate. If you pay (on average) 3% of the loan amount up front, the savings for the life of the new mortgage can be great. Please consult a tax professional before acting on hear-say that these paid points may be deducted on your taxes.
One more expense that a borrower might consider is that a reduced rate of interest will reduce the interest amount you'll be able to deduct from your taxes. We can help you do the math! Call us at 866-300-1550.
In the end, for most the amount of initial costs to refinance are paid back very quickly in monthly savings. We can help you explore your options, considering the effect a refinance could have on your taxes, how likely you may be to sell in the near future, and your available cash. Call us at 866-300-1550 to get started.
Want to know more about refinancing your home? Give us a call: 866-300-1550.