Is Mortgage Refinance a Right Option For You?

Marketers put a lot of effort in convincing you to refinance your mortgage. You’ll hear/read a lot of words like, “Interest Rates at an all time low!” and “Refinance now to save big!” etc.

But whether is it a right time for you to refinance or not depends completely on the circumstances surrounding you. Like anything else, you are the only authority that needs to determine if refinancing is right for you depending upon the specifics of your mortgage loan.

Here are some guidelines to aid you in the decision making process:

The Break-Even Analysis: Approaching a mortgage refinance company makes sense only when you can lower the interest rate enough to easily pay for the closing costs before you sell your home. In simpler terms, calculate how long do you plan on staying in this particular home and then calculate how much you’ll save each month to compensate for the closing costs of refinance. Refinancing only makes sense when you stay in the house long enough to compensate for the closing costs of refinance with the monthly savings.

Going from 30-year loan to 15-year mortgage: Another way in which refinance can help is if you plan on not lowering your monthly payments, but increasing them. If you have a 30-year mortgage and you feel that you can afford higher payments easily. 

  You might want to save on the interest and reduce your loan term. With a 30-year mortgage, you pay double in interest than what you pay in a 15-year term. So if you can afford the higher monthly payments and plan on living this home for another couple of decades, it makes sense to reduce the loan term to 15 years.

So, if you feel refinance is the right option for you, check All Western Mortgage’s mortgage refinance interest rates here. For any other query feel free to give us a call at 702-850-2790.