Weighing the Options of Refinancing
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Are you looking for a new mortgage loan? We can help! Call us at 7068605514. Want to get started? Apply Here.
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Some have said that only in the case your new interest will be at least 2 points below your current rate, should you refinance your mortgage. That could have been valid years ago, but as refinancing has been costing less over the last few years, it is never the wrong time to consider a new loan! Refinancing your loan has various benefits that will often make it worth the up-front expenditure several times over.
Advantages
When you refinance, you may be able to reduce your interest rate and monthly mortgage payment amount, perhaps considerably. You also may have the option of pulling out some of your home equity by "cashing out" some funds to renovate your home, consolidate debt, or take your family on a vacation. You might have the option to refinance into a shorter-term mortgage, enabling you to add to your equity faster.
The Cost
All of these advantages do come with some expense, though. With your refinance, you are paying for basically the same things you were charged for during your current mortgage loan. Included in your costs can be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other fees.
Do the Math
Paying points can help you attain a better interest rate. If you pay (on average) three percent of the loan amount up front, the savings for the life of the new mortgage loan can be great. You might be told that points may be deducted on your income taxes, but as tax regulations can be difficult to keep up with, we urge you to consult with a tax professional before making decisions based on this.
One more cost that borrowers may take into account is that a reduced rate of interest will lower the interest amount you will be able to deduct on your taxes. Call us at 7068605514 to help you do the math.
Most people find that the monthly savings balance out the up-front expenses of a refinance. We can help you find out what your options are, considering the effect a refinance may have on your taxes, if you are likely to sell your home in the next couple of years, and your cash on hand. Call us at 7068605514 to get started.
Want to know more about refinancing your home? Give us a call: 7068605514.