Is Refinancing Worth the Cost?
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Looking for a mortgage loan? We'll be glad to discuss our mortgage offerings! Give us a call today at 7045420820. Ready to begin? Apply Online Now.
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Have you ever heard the pearl of wisdom that says you should only consider refinancing if the new interest rate will be at least 2 points below your current one? That might have been true years ago, but with the fact that refinancing has been costing less in recent years, it is never the wrong time to consider a new mortgage! A refinance can be worth its cost many times over, factoring in the advantages that may come, as well as a reduced interest rate.
Benefits from Refinancing
You might be able to bring down your interest rate (sometimes by a lot) and make smaller monthly payments with a refinanced loan. You may also be able to "cash out" a portion of the built-up equity in your residence, that you are able use to take care of higher interest debt, make home improvements, or plan a vacation. With lower rates, you might also be able to build up home equity faster by moving to a shorter-term mortgage loan.
Fees and Expenses
As you probably expect, you will have some fees and expenses during your the refinance process. You'll be charged the same kinds of fees as with your current mortgage. Among these might be settlement costs, an appraisal, lender's title insurance, underwriting expenses, and so on.
Doing the Math
You might offer to pay discount points (prepaid interest) to gain a lower rate of interest. The money you will save on the life of the loan could be significant if you've paid up front about 3% of the new loan total. Please consult with a tax professional before acting on rumors that the points paid may be deducted on your federal income taxes.
Another cost that a borrower may consider is that a lower rate of interest will reduce the interest amount you'll be able to deduct from your taxes. We can help you do the math! Call us at 7045420820.
Most people find that the savings per month balance out the initial cost of refinancing. We will help you figure out what mortgage loan program is perfect for you, looking at your cash on hand, the likelihood of selling your house in the near future, and how refinancing might effect your taxes. Call us at 7045420820 to get started.
Curious about refinancing? Give us a call: 7045420820.
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