When is Refinancing Worth it?

Are you looking for a new mortgage loan? We'd be thrilled to answer your questions about our mortgage offerings! Give us a call at 6507631924. Want to get started? Apply Here.

Some have said that only in the case your new interest is at least two points lower, should you refinance your loan. That may have been sound advice years ago, but with refinancing dropping in cost recently, it's a good time to consider a new mortgage loan! Refinancing has a variety of benefits that will often make it worth the up-front cost a few times over.

Benefits

You could be able to lower your interest rate (sometimes significantly) and reduce your monthly mortgage payment amount with your refinanced loan. You also may be given the option of pulling out some of the equity in your house by "cashing out" some money to remodel your home, consolidate debt, or take your family on a vacation. With lower interest rates, you may also get the chance to build up home equity more quickly by changing to a shorter-term mortgage loan.

Expenses and Fees

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

Do the Math

Paying discount points can get you a better interest rate. Your savings over the life of the mortgage may be substantial if you have paid up front about three percent of the new loan balance. You may hear that points can be deducted on your income taxes, but since tax regulations are difficult to keep up with, please consult with a tax professional before depending on this.

Another thing about taxes is that once your interest rate is reduced, naturally you'll also be reducing the interest amount that you will be able to deduct on your federal income taxes. This is another expense that borrowers take into consideration. We can help you do the math! Call us at 6507631924.

Most people find that the savings each month outweigh the up-front cost of refinancing. We can help you explore your options, considering the effect a refinance might have on your taxes, how likely you may be to sell in the next couple of years, and your money on hand. Call us at 6507631924 to get you started.

Curious about refinancing? Call us: 6507631924.

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Norcal Capital Group, Inc

1369 El Camino Real
Millbrae, CA 94030