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In general, if you can make up your closing costs within two years, refinancing could be a good idea. Loan value and current interest rate are the primary factors in the equation.
Of course, rates do fluctuate. If you're looking for a particular interest rate, your window of opportunity can be as little as a couple of hours. By getting all of your paperwork in to your lender, you'll be positioned to get pre-approved for the loan and will be ready to lock your rate if rates reach your target range. That paperwork should include verification of all income and assets, such as tax returns, W2s, paycheck stubs, and bank statements.
Still not sure if refinancing is right for you? Contact BBVA Compass, and we will evaluate the benefits of refinancing based on your current mortgage.
To determine if you should refinance your mortgage, calculate whether refinancing will cost or save you money each month. Enter the terms for your current loan and for the refinance loan you are considering.
Your appraisal value should be determined by an appraiser. But you may also look online for comparable homes in your area to get an idea of your home’s current value. How long you plan to stay in the home may also determine whether you should refinance or not. The closing costs associated with refinancing may not recouped if you only plan to stay in your home for a short time.
Enter your average yearly property tax, homeowner’s insurance, state/federal tax rate, and savings rate. Refinancing your home should not cause a change in property tax or homeowner’s insurance.
How do you know if you should refinance your mortgage and what is the best way to do it? Here are some tips to help you decide if you're ready.
Thinking about refinancing your home? There are more factors than just the rate. Consider these 8 questions before making a decision.