Have you considered refinancing your home lately? With interest rates so low this is exactly what some people have been doing, in fact rates haven’t been this low in nearly 50 years however is it worth refinancing and could it be a waiste of money? In this article I’m going to give you the refinance tips you need to help you make this financial desicion.
First off, if you have a 30 year mortgage and you just either recently bought or refinanced your home a few years ago you need to consider the fact of what it will cost you to refinance. Some lenders such as most major banks and lending instutions will usually charge as much as $3500 to do this. This cost usually gets added on to your mortgage in the end. However if you could drop your rate enough to make the money back with in the next year this might be an OK opportunity. Instead go with a smaller bank credit union, refinance cost will usually be much less with these lenders.
You also need to consider how long you’ve been paying on your current mortgage? If you’ve been paying on your current mortgage for the last 5 to 10 years now refinancing back to a 30 year fixed would only start the interest clock over again and you would end up paying just that much more in interest. Instead look into refinancing into a 20 year or 15 year mortgage. Going with a lower term loan will run a lower interest rate and payment.
Lastly consider all of your options before you refinance. Take the time to talk to several lenders before you make a desicion, this way you’ll know that you’re getting the best deal out there. Also follow the tips I’ve coverdd above and you will be more likely to avoid paying more in interest and closing cost.