Refinancing your home can be a viable instrument to improve your financial situation. It can help save you money or make paying your monthly bills easier. But the fact remains that refinancing is not for everyone. Thus, before you sign on the dotted line, it is crucial to ask these questions to determine if going for a refinance makes sense, given your financial situation.
Q 1: What are my goals?
Many people choose home refinance, Cape Coral, FL, because of lower interest rates, but there are other reasons apart from that. For instance, do you want to lower your monthly bills? Do you want to shorten the term of your loan by refinancing to a 15-year mortgage from 30? Do you currently pay for an adjustable-rate mortgage and want to go for a fixed mortgage? Make sure you know and understand your goal. It gives you direction – an idea of whether or not refinancing is the best plan of action to take.
Q2: Is refinancing worth it?
Will you gain when you choose home refinance, Cape Coral, FL? You must figure out the numbers and do what the numbers are telling you. Remember, you can expect the closing costs to go between 2% and 4% of the total loan value. These include the payments for appraisal, underwriting, and title. So, let us assume, for instance, that the closing cost is USD 3,000, and you can save USD 100 a month by refinancing. Therefore, it is going to take 30 months to break even.
Q3: Can I afford the closing costs, given my financial situation?
You might see enticing lines such as “no-cost refinancing,” but that is not all true as you pay for refinancing closing costs. Although a “no-cost” refinance does not charge closing costs, they come with an interest rate that could be as much as half a percentage point higher. That is why mortgage advisors usually recommend paying the closing costs upfront. If you cannot afford to pay the closing costs beforehand, you might want to postpone your application until you can.
Online looking for a reputable broker who can help you with your home refinance, Cape Coral, FL? Contact HomePlus today at 800-810-PLUS (7587).