When is Refinancing Worth it?
 |
 |
 |
Are you looking for a new mortgage loan? We'll be glad to talk about our many mortgage solutions! Call us at 561-274-0020. Want to get started? Apply Now.
|
|
|
|
|
Have you ever heard the old rule of thumb that says you should only consider refinancing if the new interest rate is at least two points below your current one? Perhaps that was sound advice a number of years ago, but since refinance costs have been falling recently, it could be a good time to take a serious look. A refinanced mortgage loan is often worth its cost many times over, because of the benefits that come, along with a lower interest rate.
Benefits
When you refinance, you might be able to lower your interest rate and mortgage payment , sometimes by a lot. Additionally, you could have the option of tapping into the equity in your house by "cashing out" a sum of money to renovate your home, consolidate debt, or take your family on a vacation. You could be able to refinance into a shorter-term mortgage program, enabling you to add to your equity quicker.
Fees and Expenses
Of course, you'll have some fees and expenses during the the refinance process. You will have the same types of expenses and fees as with your present home loan. Among these can be settlement costs, an appraisal, lender's title insurance, underwriting expenses, and so on.
Doing the Math
Paying discount points can result in a lower interest rate. Your savings on the life of the mortgage might be substantial if you have paid up front about 3% of the new loan balance. You may have heard that points may be deducted on your income taxes, but since tax regulations can be difficult to keep up with, we urge you to speak with your tax professional before making any decisions based on this.
Another expense that a borrower may take into account is that a lower interest rate will lower the interest amount you'll deduct on your taxes. Call us at 561-274-0020 to help you do the math.
Ultimately, for most people the amount of up-front costs to refinance are made up very quickly in monthly savings. We will help you find out which program is perfect for you, considering your cash on hand, the likelihood of selling your home in the next few years, and what effect refinancing could have on your taxes. Call us at 561-274-0020 to get started.
Curious about refinancing? Give us a call: 561-274-0020.
|
