Millions of homeowners in the U.S. choose to refinance their mortgage each year, but the reasons for doing so can vary. Whether you’ve refinanced before, or you’re considering it for the first time, there are a few common questions that might be on your mind as you start reviewing your options.
In our recent blog, “6 Reasons to Consider Refinancing Your Home Now,” we laid out some common reasons for refinancing a home loan. Here, we want to address some common questions we get about refinancing.
Does It Make Sense to Refinance?
In many cases, refinancing a home loan can help you stay on track with personal financial goals—whether that means paying off your home sooner or lowering your monthly payments. There are several factors you and your lender should discuss, including your current interest rate, how far you are into your current mortgage loan, whether you plan to move in the next few years and how your loan fits into the “big picture.” It often comes down to understanding your goals in the short- and long-term, which is why it’s so important to work with a home lender you trust.
When is the Best Time to Refinance a Home Loan?
Should you refinance now or wait until interest rates drop a bit more? Waiting for lower interest rates is a common reason many people hold off on refinancing their home, even if all the conditions are already perfect. While it’s important to weigh all your options, it’s impossible to make plans based on what you don’t know—and, while many experts can make well-qualified predictions, no one can know for sure where interest rates will be next week, next month or next year. This is why our team works with each borrower to make recommendations based on individual goals. There is no “one-size-fits-all” approach, and what may make sense for one homeowner may not make sense for another.
How Many Times Should You Refinance Your Mortgage?
Refinancing now will not prevent you from refinancing again. Ultimately, the decision to refinance more than once depends on your reason for refinancing in the first place. If you’re looking to lower your interest rate, for example, you may end up refinancing multiple times to get to the lowest rate. With this in mind, it’s important to work with your loan team on how to manage the costs associated with your loan. For some, it may make sense to accept a slightly higher APR in lieu of paying closing costs, while others might benefit from paying those associated costs upfront.
Our Team is Here to Help You Make the Most Informed Decisions
We are currently in a historically low-interest-rate environment and refinancing this year may help you achieve your financial goals. Our team is here to help you review your options and help you decide whether refinancing now makes sense.
Contact us today to get started.