When Should I Refinance my Boise, Idaho Home
It has been said that only if your new interest is at least two points under your current rate, should you refinance your loan. Perhaps several years ago that was good advice, but as refinance costs have been falling recently, it may be time to look into it. Refinancing has a number of benefits that often it worth the initial cost several times over.
When you refinance, you might have the ability to reduce your interest rate and monthly mortgage payment, sometimes by a lot. You may also have the ability to “cash out” a portion of your equity, that you will be able to use to consolidate debt, improve your home, or finance a vacation. With reduced rates, you might also be able to build up home equity faster by moving to a shorter-term mortgage.
As you probably know, you will have some fees and expenses during the refinance process. You will be charged the same sort of fees as with your existing home loan. Included in your costs will probably be an appraisal, underwriting fees, lender’s title insurance, settlement costs, and other fees.
Do the Math
Paying points can result in a better interest rate. When you pay (on average) three percent of the mortgage loan amount at the start, your savings for the term of the new loan can be great. Please talk to a tax professional before acting on hear-say that these paid points may be deducted on your taxes.
Speaking of taxes, once you lower your interest rate, naturally you’ll also be reducing the paid interest amount that you can deduct from your federal income taxes. This is one more expense that some borrowers consider. We can help you do the math! Call us at (208) 853-7878.
Most people find that the monthly savings quickly balance out the up-front expenses of a refinance. We can help you figure out what your options are, considering the effect a refinance may have on your taxes, whether you are likely to sell your home in the next couple of years and your available cash.
Want to know more about refinancing? Call us: (208) 853-7878.
*American Pacific Mortgage does not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. Debt consolidation may increase your monthly cash flow, but may increase the amount of your debt over a period of time by including the additional debt in your mortgage amount, which is financed over a longer period of time than the debt consolidated may have been financed. We encourage all consumers to do their own research and examine their options carefully before selecting a particular course of action.