Should You Refinance?

Refinancing Lafayette CA

Determine if refinancing is right for you!

The ebbs and flows of the housing market can be complicated. One month interest rates can be sky high and the next month they can fall to a more reasonable rate. Determining when to buy a home based on good interest rates is difficult, especially because life often doesn’t wait until interest rates are low. Should interest rates fall after you purchased your home, it might be worth refinancing now. A good rule of thumb on when to re-finance is to take the monthly savings on the new mortgage and divide it into the costs of obtaining the new loan giving you the number of months for payback. The payback period should not be more than 3 years. Interest rates are only expected to rise within the next year, so check out these factors that might make it the right time to refinance your mortgage.

Rising Interest Rates.   

Interest rates are rising and will continue to rise in the next year. If you’re unhappy with your mortgage rates, look into whether or not the current interest rate gives you a good deal. Be careful, though! A lower interest rate may not be a better deal over time. Work out all the long term costs to be sure that you’re making the right financial decision.

You’ve had your mortgage for a short period of time.

If you’ve had your mortgage for a long time, refinancing isn’t worth all the paperwork and ultimately it will restart the authorization process. However, if you’ve purchased a home recently, then a better deal may be worth the hassle.

You plan on staying put.

If you’re planning on moving in the near future, refinancing may wind up costing you more money than it would save you. But, if you’re planning on building a life in your home for years to come it’s worth it to consider refinancing for a better deal.

Are you ready to refinance? Or do you want to hunt for your dream home before rates rise in the coming year? Contact professional Realtor Cary Amo in Lafayette, California for all your real estate needs.

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