August 22nd, 2011
For those who aren’t yet homeowners, the decision of whether or not to take advantage of current mortgage rates seems like a no-brainer.
But what about current homeowners? Many aren’t sure whether or not it makes sense to refinance.
In her blog post “Refinancing Tips to Save You Money,” Jill Simmons offers some tips for making sure you get the most out of a refinance.
Do the math. If you’re considering refinancing, you want to first figure out what the break-even point is. If you’re current rate is in the 5 percent range, it makes sense to lock in a 4 percent range rate – IF you plan to stay in your home for some time.
Remember, there are expenses involved with any mortgage transaction. But the money you’ll save in interest in the long run is definitely worth the upfront cost of refinancing if you plan on staying in your home for a few years at least.
Ask for a refinance rate. You’ll be required to get a new title insurance policy when you refinance. Make sure to ask your title company if you qualify for a refinance rate or discount santa ana bail bonds .
Consider a cash-in refinance. As Simmons points out, you need to have 20 percent equity in your home to get the best refinance rates. In other words, you have to own at least 20 percent of the home, which means you’ve paid at least 20 percent off.
Find out how close you are to that 20 percent. If you’re close and you have some cash to spare, putting down extra money can get you a lower rate.
Confirm Your Rate Lock. Simmons explains,
“The surge in refinancing has real-life implications, and lenders are suddenly very busy with an influx of new business. Ask your lender how long loans are taking to close, and what sort of timing you can expect. Confirm that your rate is locked and will close in a specified period.”
At Acadia Lending, we pride ourselves on our ability to close loans on time. Call a lender today to discuss the opportunity to refinance!