Time to Refinance
Interest rates are lower than they have been in a year right now, and many people are thinking of refinancing their current mortgage to get rid of mortgage insurance, lower their payment, take some money out to consolidate credit card debt, pay for home improvements, etc. So when is the right time to refinance? Lenders are always telling you to refinance, but how do you know if it really makes sense to refi or if the lenders are just after the sales commission they get for selling you a new loan?
Here’s what you need to know to make a good financial decision.
There are always closing costs involved in refinancing your current mortgage. They can be included in the new loan amount so it seems as if there aren’t any closing costs, but there’s really no such thing as a no closing cost loan. Because it does cost you some money to refinance, you need a lot more information to make a good decision than just knowing what your new interest rate will be.
Total Cost Analysis
We have some great software that shows our clients all the information they need to make the right decision when they are considering a refi. It shows you the following things:
- How much the closing costs are
- How much your monthly payment will change if you refinance
- How much you will save over the first 5 years of the new loan
- How much you will save over the life of the loan
We can also tell you how many months it will take to get back the money you will spend in closing costs if you refinance.
Once you know all of these things, you will be armed with all the information you need to make a sound financial decision. To get started, contact us today.