Refinancing is often looked upon as a panacea for cost saving and lowering monthly payments and interest rates. While in some situations refinancing a mortgage loan may be a good idea, in others it may just be a recipe for disaster.
The Loans.net team has created the following tips to help you decide when to refinance and when not to.
One of the most important considerations while considering when to refinance is whether you are planning to sell your property. While refinancing may be advantageous and cost-effective, the process does involve closing costs. Typically, it would take several months before one can recover the closing costs so if there is a plan to sell the property in the short run, it may not be much of an advantage to refinance.
If, however, you are planning to stay in the house for a while and refinancing otherwise appears to be a good option then it may be a good idea to consider doing so.
While lowering interest rates may be an important goal, the duration of the mortgage also bears critical consideration. If one manages to secure a lower interest rate but extends the duration of the mortgage, the overall cost over the course of the mortgage would be much higher.
It is very important to create a spreadsheet to compare multiple scenarios and permutations and combinations associated with different elements of the loan term.
If you decide to refinance, Loans.net has prepared a comprehensive resource of various refinancing options. With many lenders in our nationwide network, the process of comparing and selecting one just got easier. Loans.Net is your trusted resource and link.Click here to compare and choose your refinancing options
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