When Does It Make Sense to Refinance Your Mortgage?

One of the biggest expenses homeowners have is mortgage interest. This is why mortgage refinance is popular. Still, you should not be refinancing for the sake of it. Read on for an overview of when it makes sense to refinance.

Check how much rates have dropped and consider the amount you owe. A single digit fall in rates can mean significant savings, especially if you still have hundreds of thousands of dollars to pay. In such a case, refinancing your loan to take advantage of the lower rates will make sense. Find a location near you and get in touch with us.

Find out whether you can reduce your loan term through refinancing. If you have a 15-year mortgage and you refinance into a 30-year deal, you may enjoy lower rates but will end up paying more in the long-run. On the other hand, if you refinance a 30-year mortgage into a 15-year one, you can end up with significant savings, especially if you are given a lower rate.

You should also know how long you plan to keep the mortgage. If your plan is to sell soon, you may end up spending more on the refinancing.