When is Refinancing Worth it?

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It has been said that only when your new interest is at least two points lower, should you refinance your mortgage. Maybe that was sound advice a number of years ago, but since refinance costs have been getting lower, it may be a good time to take a serious look. A refinance is often worth its cost several times over, considering the benefits that can come, along with a lower interest rate.


When you refinance, you might have the ability to reduce the interest rate and mortgage payment amount, sometimes considerably. You also might be given the option of pulling out some of your home equity by "cashing out" some money to renovate your home, consolidate debt, or plan a special vacation. With reduced rates, you may also get the chance to build your home equity more quickly by moving to a shorter-term loan.

Fees and Expenses

Of course, you will have to pay for your the refinance process. You will have the same types of expenses and fees as with your current mortgage. Among these will be settlement costs, appraisal fees, lender's title insurance, underwriting expenses, and so on.

Do the Math

Paying points can help you get a lower interest rate. When you pay (on average) 3% of the mortgage loan amount initially, your savings for the term of the refinanced mortgage can be great. Please talk to a tax professional before acting on rumors that the points paid may be deducted on your taxes.

One more expense that a borrower may take into account is that a reduced rate of interest will reduce the interest amount you'll deduct from your taxes. We can help you do the math! Call us at 3038627760.

Most people find that the monthly savings quickly outweigh the initial cost of a refinance. We will help you figure out which mortgage program is ideal 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 will probably have on your taxes. Call us at 3038627760 to get you started.

Curious about refinancing? Call us: 3038627760.