Is Refinancing Worth the Cost?
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Looking for a mortgage loan? We'll be glad to discuss our many mortgage solutions! Call us at 3038627760. Want to get started? Apply Now.
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Ever hear the pearl of wisdom that states you should only refinance if your new interest rate is at least 2 points under your present one? Perhaps that was sound advice a number of years ago, but as refinance costs have been getting lower, it may be a good time to take a serious look. A refinanced mortgage may be worth its cost several times over, considering the advantages that it brings, along with a reduced interest rate.
Advantages of Refinancing
When you refinance, you might be able to reduce the interest rate and mortgage payment amount, perhaps significantly. You also might have the option of tapping into the equity in your property by "cashing out" some funds to renovate your home, consolidate debt, or plan a special vacation. You may have the option to refinance into a shorter-term mortgage, enabling you to build your equity faster.
Fees and Expenses
Of course, you will have some fees and expenses during the process of refinancing. You will pay the same types of fees as with your existing mortgage loan. Among these might be settlement costs, an appraisal, lender's title insurance, underwriting fees, and so on.
Doing the Math
Paying discount points can result in a lower interest rate. The amount you'll save on the life of the mortgage could be substantial if you have paid up front about three percent of the new loan total. Please consult a tax professional before acting on advice that these paid points can be deducted on your taxes.
Speaking of taxes, if your interest rate is reduced, it follows that you'll also be reducing the interest amount that you'll be able to deduct on your taxes. This is one more cost that borrowers consider. We can help you do the math! Call us at 3038627760.
Ultimately, for most borrowers the total of initial costs to refinance are made up soon in monthly savings. We'll work with you to determine what program is perfect for you, looking at your cash on hand, how likely you are to sell your house in the next few years, and the effect refinancing may have on your taxes. Call us at 3038627760 to get started.
Want to know more about refinancing your home? Give us a call at 3038627760.