Refinancing costs
You need to consider the costs for refinancing in order to determine whether or not it will be worthwhile for your particular financial situation. Unfortunately, you must be willing to invest some money in order to save in the long run. Be prepared to pay multiple refinancing costs that include filing, credit checks, application fees, title examination costs, and appraisal fees.
- Lower monthly payment
- Tax benefits
- Lower interest
- Obtain cash
- Consolidate debt
Should you refinance?
There isn’t a clear
cut and dry answer to whether or not you should refinance without looking at
the smaller details. First of all, if you are planning to move in the next few
years, refinancing may not be for you. You want to reside in the house and keep
the new loan long enough to reap the benefits, and this may take a while.
If your credit
score has greatly improved since your original mortgage loan, it may be a great
idea to take advantage of low refinancing rates. Also, if you have
high-interest loans that you wish to pay off or get a lower rate, refinancing
may be a good option. It’s not a good idea to refinance simply to get cash to
go on vacation or buy a new luxury car. Refinancing is a good option for those
who want to pay for college tuition or get a shorter mortgage.
Right now, you have
an opportunity to get some great mortgage rates through refinancing. And don’t
forget about HARP, which lets borrowers refinance even though they may owe more
than their home is worth. Keep in mind that the borrower's loan must be
owned or guaranteed by Fannie Mae or Freddie Mac. HARP expires at the end of December in 2015.
