Weighing the Options of Refinancing
 |
 |
 |
Searching for a mortgage loan? We can help! Call us at 9094671090. Ready to begin? Apply Here.
|
|
|
|
|
Some have said that only in the case your new interest will be at least two points under your current rate, should you refinance your loan. Perhaps that was sound advice several years ago, but since refinance costs have been falling recently, it could be a good time to look into it. A refinanced mortgage is often worth its cost several times over, because of the advantages that come, in addition to a lower interest rate.
Benefits
You could be able to lower your interest rate (sometimes by a lot) and reduce your monthly mortgage payment amount with a refinanced loan. Additionally, you might be given the option of tapping into your home equity by "cashing out" a sum of money to renovate your home, consolidate debt, or plan a special vacation. With lower interest rates, you may also be able to build your home equity faster by moving to a shorter term loan.
Fees and Expenses
Of course, you will have some fees and expenses during the process of refinancing. When you refinance, you are paying for basically the same things you paid for during your original mortgage loan. Among these will be settlement costs, an appraisal, lender's title insurance, underwriting fees, and others.
Doing the Math
You might need to pay points (prepaid interest) to attain a lower interest rate. When you pay (on average) three percent of the loan amount up front, your savings for the life of the refinanced mortgage loan can be great. We recommend that you talk to a tax professional before acting on advice that any paid points can be deducted on your federal income taxes.
Another cost that borrowers may consider is that a reduced rate of interest will lower the interest amount you'll deduct on your federal income taxes. We can help you do the math! Call us at 9094671090.
Most people find that the savings each month outweigh the initial cost of a refinance. We can help you explore what your options are, considering the effect a refinance may have on your taxes, if you are likely to sell your home in the near future, and your available cash. Call us at 9094671090 to get started.
Curious about refinancing your home? Call us: 9094671090.