Weighing the Options of Refinancing

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Ever hear the pearl of wisdom that states you should only refinance if your new interest rate is at least 2 points lower than your current one? That might have been accurate a while back, but with refinancing dropping in cost recently, it is a good time to think about a new mortgage! A refinance is often worth its cost several times over, factoring in the advantages that can come, along with a lower interest rate.

Benefits

When you refinance, you could have the ability to reduce your interest rate and monthly payment , perhaps considerably. You also might have the option of pulling out some of your home equity by "cashing out" some money to fix up your home, consolidate debt, or plan a special vacation. You might have the option to refinance to a shorter-term mortgage program, enabling you to add to your home equity faster.

Expenses and Fees

All these benefits do cost something, though. When you refinance, you are paying for basically the same things you were charged for during your original mortgage loan. Included in the list may be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other fees.

Do the Math

You might think about paying points to reduce your interest rate. When you pay (on average) 3% of the mortgage loan amount up front, the savings for the term of the new mortgage can be great. We recommend that you consult with a tax professional before acting on advice that these points paid may be deducted on your federal income taxes.

Another thing about taxes is that once you reduce your interest rate, it follows that you will also be reducing the interest amount that you can deduct on your federal income taxes. This is one more expense that borrowers take into account. We can help you do the math! Call us at 7068605514.

Most people find that the monthly savings outweigh the up-front cost of refinancing. We'll help you determine which mortgage loan program is ideal for you, considering your cash on hand, the likelihood of selling your home in the near future, and how refinancing might effect your taxes. Call us at 7068605514 to get you started.

Want to know more about refinancing your home? Call us at 7068605514.

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Augusta Mortgage Solutions

NMLS#:148529 GA Residential Mortgage Licensee #18861

141 North Belair Road Suite 102 NMLS# 149807
Evans, GA 30809-7431