Weighing the Options of Refinancing

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Some have said that only when your new interest will be at least 2 points lower, should you refinance your mortgage. That might have been valid a while back, but with the fact that refinancing has been costing less in recent years, it's a good time to explore the options of a new mortgage loan! Refinancing has a variety of advantages that can make it worth the up-front expenditure a few times over.


When you refinance, you may have the ability to lower your interest rate and monthly mortgage payment , perhaps considerably. You also might have the option of tapping into the equity in your house by "cashing out" a sum of money to remodel your home, consolidate debt, or take your family on a vacation. With lower interest rates, you might also get the chance to build up home equity more quickly by changing to a shorter term loan.

The Cost

As you probably know, you'll have to pay for your process of refinancing. With your refinance, you are paying for basically the same things you were charged for during your current mortgage. These can include settlement costs, appraisal fees, lender's title insurance, underwriting fees, and others.

Do the Math

Paying points can help you attain a lower 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 consult with a tax professional before acting on hear-say that any points paid can be deducted on your federal income taxes.

One more expense that borrowers might consider is that a lower interest rate will reduce the interest amount you will deduct on your taxes. We can help you do the math! Call us at (718) 477-4405.

In the end, for most people the amount of up-front costs to refinance are made up very quickly in savings each month. We can help you explore your options, considering the effect a refinance might have on your taxes, whether you are likely to sell your home in the next couple of years, and your available cash. Call us at (718) 477-4405 to get started.

Curious about refinancing? Call us at (718) 477-4405.

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