Refinance Mortgage - Home Refinancing Information

Time to Refinance

The first thing that you will want to do is to check the current interest rates that are being offered by home loan lenders. There are many factors that motivate people to refinance their mortgages, the most obvious and common is to save money. Is now the time to refinance? You could actually be losing money by hanging on to your old mortgage.

It is very lilkely that you could be saving some money if the interest rate for your current mortgage is high. A general rule to follow is that if your rate is 1.5% more than today's rates or higher, then it is quite likely you will save money by refinancing.

If you happen to an adjustable rate mortgage, then you will want to compare the lifetime caps of your mortgage and today's ARMs to determine if your rate is high enough to justify refinancing. Another thing to keep in mind is that the likelihood of saving money greatly increases the longer you plan to keep the property. The best way to determine if you will benefit by refinancing is to determine how long it will take you to recoup the costs of refinancing.

You can start by calculating all the costs associated with refinancing. Refinancing costs can include such items as points, loan fees, appraisal, title insurance, prepayment penalties and more. You should also be aware that you will lose tax benefits as a result of refinancing. Remember, interest paid on your mortgage loan is tax deductable, therefore, you cannot properly estimate your recouperation period this way.