Home Loan Application Contact Us Customer Login

Is Refinancing Worth the Cost?

Searching for a loan? We'll be glad to discuss our many mortgage solutions! Give us a call at (909) 467-1090. Want to get started? Apply Here.

Some have said that only if your new interest is at least 2 points under your current rate, should you refinance your loan. Perhaps several years ago that was sage advice, but since refinance costs have been getting lower, it could be time to take a serious look. A refinance is often worth its cost many times over, factoring in the benefits that it brings, in addition to a lower interest rate.

Advantages

When you refinance, you could have the ability to reduce the interest rate and monthly payment , perhaps significantly. You also might have the option of pulling out some of the equity in your property by "cashing out" a sum of money to remodel 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 home equity faster.

The Cost

All of these benefits do come with some expense, though. When you refinance, you are paying for basically the same things you were charged for during your current mortgage. Among these might be settlement costs, appraisal fees, lender's title insurance, underwriting expenses, and others.

Doing the Math

You might need to pay points (prepaid interest) to gain a better interest rate. Your savings on the life of the loan might be significant if you have paid up front about 3% of the new loan balance. You may hear that the points may be tax deductible, but since tax regulations are ever-changing, we urge you to consult a tax professional before considering this in your calculations.

Speaking of taxes, if your interest rate is reduced, of course you will also be reducing the interest amount that you can deduct from your taxes. This is one more cost that borrowers take into account. Call us at (909) 467-1090 to help you do the math.

Most borrowers find that the monthly savings outweigh the up-front cost of refinancing. We can help you explore your options, considering the effect a refinance may have on your taxes, if you are likely to sell your home in the next couple of years, and your money on hand. Call us at (909) 467-1090 to get you started.

Want to know more about refinancing your home? Give us a call: (909) 467-1090.

Get a Refinance Quote

Looking to refinance your home? Fill out the following form to get a fast quote from us.

Contact Info
Property Information
Mortgage Information
Questions