When is Refinancing Worth it?

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Some have said that only when your new interest is at least two points lower, should you refinance your loan. Maybe several years ago that was sage advice, but as refinance costs have been falling recently, it could be time to take a serious look. A refinanced mortgage loan may be worth its cost several times over, factoring in the advantages that come, along with a lower interest rate.

Benefits from Refinancing

When you refinance, you may have the ability to reduce your interest rate and monthly mortgage payment amount, perhaps considerably. You also might have the option of pulling out some of the equity in your house by "cashing out" a sum of money to remodel your home, consolidate debt, or plan a special vacation. With lower interest rates, you may also be able to build your home equity faster by switching to a shorter-term loan.

Expenses and Fees

All of these benefits do cost something, though. You'll have to pay the same types of fees as with your current home loan. Included in your costs may be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other expenses.

Do the Math

Paying points can get you a lower interest rate. When you pay (on average) three percent of the mortgage loan amount initially, your savings for the term of the refinanced mortgage loan can be great. Please consult with a tax professional before acting on hear-say that the points paid may be deducted on your taxes.

Speaking of taxes, when you lower your interest rate, it follows that you'll also be reducing the paid interest amount that you'll be able to deduct from your federal income taxes. This is another expense that some borrowers consider. Call us at 8014134570 to help you do the math.

All things considered, for most the amount of up-front costs to refinance will be made up very quickly in savings each month. We can help you explore your options, considering the effect a refinance could have on your taxes, whether you are likely to sell your home in the next couple of years, and your money on hand. Call us at 8014134570 to get you started.

Want to know more about refinancing? Give us a call at 8014134570.

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Integris Loans

9980 S 300 W Ste 200
Sandy, UT 84070