When is Refinancing Worth it?
Shopping for a mortgage? We will be glad to assist you! Call us at 405-513-7700. Ready to get started? Apply Here.
Some have said that only if your new interest is at least two points below your current rate, should you refinance your loan. That could have been sound advice years ago, but with refinancing dropping in cost over the last few years, it's a good time to explore the options of a new mortgage! A refinanced mortgage loan is often worth its cost several times over, considering the benefits that can come, as well as a reduced interest rate.
Advantages of Refinancing
When you refinance, you may have the ability to lower your interest rate and monthly payment , sometimes significantly. You might also be able to "cash out" a portion of the built-up equity in your home, that you are able use to take care of higher interest debt, make home improvements, or finance a vacation. You might be able to refinance into a shorter-term mortgage loan, giving you the ability to build up your equity faster.
Expenses and Fees
Of course, you will have some fees and expenses during your process of refinancing. You will pay the same kinds of expenses and fees as you did with your present mortgage loan. Included in your costs may be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other fees.
Do the Math
You might consider paying points to receive a lower interest rate. Your savings on the life of the mortgage may be substantial if you have paid up front about 3% of the new loan balance. Please consult a tax professional before acting on rumors that these points paid may be deducted on your taxes.
Another expense that a borrower might take into account is that a reduced interest rate will reduce the interest amount you'll deduct on your federal income taxes. We can help you do the math! Call us at 405-513-7700.
Most borrowers find that the savings per month quickly outweigh the initial expenses of refinancing. We can help you figure out your options, considering the effect a refinance could have on your taxes, how likely you may be to sell in the near future, and your available cash. Call us at 405-513-7700 to get started.
Want to know more about refinancing your home? Call us at 405-513-7700.