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Is It Worthwhile to Refinance my mortgage?

Should you refinance your mortgage?

Mortgage Refinance

Most industry experts (and some not so expert) agree that interest rates will increase. We have been warned by the Federal Reserve that the rates will, indeed, continue to rise. Many are surprised that the mortgage interest rates remain as low as they are. So should you take this opportunity to refinance?

It depends upon your circumstances. Let’s look at a few examples.

Your current mortgage rate is higher than what is available.

If this is so, a simple math calculation will tell you if you should refinance. You will need to speak with a mortgage rep for the answer. If you need a referral, call me, Art Reiman – Realtor at 732-598-7700. By speaking with a mortgage rep, you can learn what the refinancing expenses will be. You will also learn what the payments will be. You can also inquire about different length terms of a mortgage. If you only have 20 years on your current mortgage, think about a 20 year mortgage instead of the traditional 30 year term. If your reduced monthly payments will allow you to recoup the refinance expenses in a reasonable time, go for it.

Do you have a good reason to refinance?

Think seriously before reducing your equity to pay down credit card debt or to purchase an expensive car. It is too easy to run up the credit card debt again, and a car depreciates very quickly.

Do you have a balloon mortgage or an adjustable rate mortgage?

If yes, you may want to lock in today’s lower rates for the long term rather than try later if or when the existing mortgage’s rates increase.

Do you want to invest your equity?

If you want to cash out and invest in the stock market, be very careful. But if you want to get cash from your home to purchase a new home, this is a very cheap way to finance a new home. And if you do so, you can then turn your existing home into a rental. Again, this is a simple math exercise. If the numbers work, by all means go ahead. And if this is your goal, visit our web site, to begin your search for a new home.

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