Is Refinancing Worth the Cost?
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Looking for a mortgage loan? We'll be glad to talk about our many mortgage solutions! Call us at 2603382561. Ready to begin? Apply Online Now.
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It has been said that only when your new interest is at least two points below your current rate, should you refinance your loan. That may have been valid a while back, but since refinancing has been costing less recently, it's never the wrong time to think about a new mortgage loan! A refinance is often worth its cost several times over, factoring in the advantages that it brings, as well as a lower interest rate.
Benefits
You could be able to bring down your interest rate (sometimes significantly) and reduce your monthly mortgage payment amount with your refinanced loan. Additionally, you might have the option of pulling out some of the equity in your property by "cashing out" some funds to fix up your home, consolidate debt, or plan a special vacation. You may be able to refinance to a shorter-term mortgage program, giving you the ability to build up your equity quicker.
Fees and Expenses
All these advantages do come with some expense, though. With your refinance, you are paying for most of the same things you paid for at the time you got your current mortgage loan. Included in your costs may be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other expenses.
Do the Math
You might investigate paying points to reduce your interest rate. If you pay (on average) 3% of the mortgage loan amount up front, your savings for the life of the refinanced loan can be substantial. Please consult a tax professional before acting on rumors that the paid points can be deducted on your federal income taxes.
Speaking of taxes, when you bring down your interest rate, naturally you'll also be lowering the interest amount that you'll be able to deduct on your federal income taxes. This is one more expense that some borrowers take into consideration. We can help you do the math! Call us at 2603382561.
Most people find that the savings each month quickly outweigh the initial expenses of a refinance. We will work with you to figure out what mortgage program is right for you, looking at your cash on hand, the likelihood of selling your house in the near future, and how refinancing can effect your taxes. Call us at 2603382561 to get started.
Curious about refinancing? Give us a call at 2603382561.