Question:

How to refinance your home?

Answer:

To make it worthwhile when refinancing your home loan, you may choose follow the old rule of thumb "refinance only if you could get 2% off the rate in the least". This is not so valid these days, though, especially for greater loan amounts.

How to refinance your home loan successfully?

First decide whether you actually need to refinance. Well, if you have the feeling you are paying too much on mortgage, you probably are. If you have an ARM with a fixed rate term going to expire, you might be looking for a refinance already.

To refinance your home and make the most of it you should know that refinancing is worth it, if it makes sense after calculations are made. You need to to collect refinance quotes and compare the rates you are getting. Basically, to arrive at the breakeven point, you will need to know the closing costs of the refinance and how much you'll be saving on monthly payments with the refinance rates.

Roughly, if the closing costs of your home refinance amount to $4500, and you will be saving $150 in monthly payments, the breakeven point occurs after two years and six months (30 months). If you plan on staying in your home less than two years and a half, you shouldn't bother to refinance. If you intend to keep this house for longer, then refinancing your home may be a good bargain in this case.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 2.9/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: