Weighing the Options of Refinancing
 |
 |
 |
Looking for a loan? We can assist you! Call us at 9043423622. Ready to begin? Apply Here.
|
|
|
|
|
Ever heard the old rule of thumb that states you should only refinance if the new interest rate is at least 2 points lower than your existing one? That might have been true a while back, but with the fact that refinancing has been costing less recently, it's a good time to think about a new loan! Refinancing your loan has some advantages that can make it worth the up-front expenditure a few times over.
Benefits
When you refinance, you might have the ability to lower the interest rate and monthly payment , sometimes significantly. You could also be able to "cash out" some of the built-up equity in your home, which you can use to consolidate debt, make home improvements, or finance a vacation. You may be able to refinance into a shorter-term mortgage loan, enabling you to add to your equity quicker.
Expenses and Fees
As you probably know, you will have to pay for the process of refinancing. You will be charged the same kinds of expenses and fees as with your present mortgage loan. Included in the list might be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other fees.
Doing the Math
You could offer to pay points (prepaid interest) to get a lower interest rate. If you pay (on average) three percent of the loan amount at the start, the savings for the term of the refinanced mortgage loan can be great. We recommend that you talk to a tax professional before acting on rumors that any points paid may be deducted on your taxes.
An additional expense that borrowers might consider is that a reduced interest rate will reduce the interest amount you'll be able to deduct on your taxes. We can help you do the math! Call us at 9043423622.
All things considered, for most the amount of initial costs to refinance are made up very quickly in monthly savings. We will help you determine what mortgage loan program is ideal for you, looking at your cash on hand, the likelihood of selling your home in the near future, and what effect refinancing may have on your taxes. Call us at 9043423622 to get you started.
Curious about refinancing your home? Call us: 9043423622.