Posted on: 05th Oct, 2009 10:15 am
HI EVERYONE,
I NEED AN ADVICE.
MY CURRENT RATE ON MY MORTGAGE IS 7.25% FIXED. I NEED TO KNOW IF IT IS A GOOD IDEA FOR ME TO TRY TO REFINACE FOR A LOWER RATE (5.75%) FOR EXAMPLE, BUT I ALSO PLAN ON SELLING THE HOUSE WITHIN 3 YEARS OR SO. SHOULD I REFINACE CONSIRERING CLOSING COSTS AND ALL THE FEES?
THANK YOU
I NEED AN ADVICE.
MY CURRENT RATE ON MY MORTGAGE IS 7.25% FIXED. I NEED TO KNOW IF IT IS A GOOD IDEA FOR ME TO TRY TO REFINACE FOR A LOWER RATE (5.75%) FOR EXAMPLE, BUT I ALSO PLAN ON SELLING THE HOUSE WITHIN 3 YEARS OR SO. SHOULD I REFINACE CONSIRERING CLOSING COSTS AND ALL THE FEES?
THANK YOU
you need to check savings. check 3 yrs reduction in monthly out go. if it is less than closing cost for refinance, you can go ahead. otherwise no point in doing it.
The larger the loan amount, the more it may may make sense to refinance or not.
If your mortgage amount is $300,000 or more, it may make sense. If your mortgage is $100,000 it might not make sense. The larger the mortgage, the greater a drop in monthly payments whe the interest rate is lowered.
Divide total closing costs by the drop in your monthly payment. If the answer is 36 or less, it may make sense for you to refinance.
If your mortgage amount is $300,000 or more, it may make sense. If your mortgage is $100,000 it might not make sense. The larger the mortgage, the greater a drop in monthly payments whe the interest rate is lowered.
Divide total closing costs by the drop in your monthly payment. If the answer is 36 or less, it may make sense for you to refinance.
