Is Refinancing Worth the Cost?

Are you looking for a new mortgage loan? We'll be glad to discuss your mortgage needs! Call us at (585) 282-0960. Want to get started? Apply Here.

Have you ever heard the old rule of thumb that states you should only consider refinancing if the new interest rate is at least two points below your present rate? That might have been valid years ago, but since refinancing has been costing less recently, it's a good time to consider a new mortgage! A refinance is often worth its cost several times over, factoring in the advantages that it brings, along with a reduced interest rate.

Benefits from Refinancing

When you refinance, you could have the ability to reduce your interest rate and monthly mortgage payment , sometimes considerably. You could also be able to "cash out" a portion of the built-up equity in your residence, that you will be able use to consolidate debt, make home improvements, or finance a vacation. You may have the option to refinance into a shorter-term mortgage, enabling you to add to your equity faster.

Expenses and Fees

Of course, you will have some fees and expenses during your process of refinancing. With your refinance, you're paying for most of the same things you were charged for at the time you got your original mortgage loan. Among these may be settlement costs, appraisal fees, lender's title insurance, underwriting expenses, and so on.

Doing the Math

Paying points can help you get a better interest rate. Your savings over the life of the loan might be substantial if you have paid up front about three percent of the new loan balance. We recommend that you consult a tax professional before acting on hear-say that the paid points may be deducted on your federal income taxes.

Another thing about taxes is that once your interest rate is lowered, of course you will also be reducing the interest amount that you can deduct from your taxes. This is another expense that borrowers take into account. We can help you do the math! Call us at (585) 282-0960.

Most people find that the monthly savings quickly balance out the initial cost of a refinance. We will work with you to determine what loan program is perfect for you, considering your cash on hand, how likely you are to sell your home in the near future, and how refinancing could effect your taxes. Call us at (585) 282-0960 to get you started.

Curious about refinancing your home? Call us: (585) 282-0960.