Is Refinancing Worth the Cost?
In the market for a new mortgage? We'd be thrilled to answer your questions about your mortgage needs! Call us at (816) 525-8000. Ready to begin? Apply Now.
It has been said that only if your new interest is at least two points lower, should you refinance your loan. That might have been true years ago, but with refinancing dropping in cost in recent years, it's never the wrong time to think about a new mortgage! A refinance is often worth its cost many times over, factoring in the advantages that may come, in addition to a reduced interest rate.
When you refinance, you could be able to lower the interest rate and monthly mortgage payment , sometimes considerably. Additionally, you could be given the option of pulling out some of your home equity by "cashing out" some money to fix up 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 faster by switching to a shorter-term mortgage.
Fees and Expenses
All of these advantages do cost something, though. With your refinance, you're paying for most of the same things you were charged for during your current mortgage loan. These may include settlement costs, an appraisal, lender's title insurance, underwriting expenses, and others.
Do the Math
You might offer to pay discount points (prepaid interest) to attain a more favorable interest rate. The money you'll save over the life of the loan could be significant if you've paid up front about three percent of the new loan total. We recommend that you talk to a tax professional before acting on advice that any points paid can be deducted on your taxes.
Another expense that borrowers might consider is that a reduced rate of interest will reduce the interest amount you will deduct from your taxes. We can help you do the math! Call us at (816) 525-8000.
Most borrowers find that the savings each month quickly balance out the up-front cost of refinancing. We can help you find out what your options are, considering the effect a refinance might have on your taxes, how likely you might be to sell in the next couple of years, and your available cash. Call us at (816) 525-8000 to get you started.
Curious about refinancing? Call us at (816) 525-8000.
Get a Refinance Quote
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