Refinancing your home can have major benefits: a lower monthly payment, cash use of home equity for a variety of purposes, generate more appetizing mortgage terms, etc. However, there are a few things to remember when entering into a mortgage refinance, like refinance cost.
Here are a couple of cost options to remember when you’re ready to refinance your home:
The biggest group of refinancing costs that you should be aware of is the closing costs. While you may not have to pay the same closing costs you did when you first purchased the house, there’s a good chance you’ll need to pay at least 2% of the remaining mortgage loan, but typically no more than 5%.
Average closing costs may include your loan application fee, private mortgage insurance, escrow fees, credit checks, attorney fees and any other property-related payments. However, these fees are based on the individual loan provider
Some refinance programs don’t require you to pay closing costs. No-closing-cost refinance options are often considered if the closing costs on your new loan don’t quite fit into the budget. The costs are typically added in with your new loan principal and may come up as higher interest rates, larger monthly payments or an extension of the loan term.
Refinance closing costs are typically part of the refinancing game, which may cause some homeowners to turn away from refinancing. However, the benefits of refinancing may outweigh the costs, and with a plethora of options available for a variety of financial situations, there’s a good chance you’ll find the right mortgage refinancing program for your circumstance.
If you need an extra bout of insight but don’t know where to start, try your real estate agent and the network of loan and finance professionals they may have at their disposal.
For over 25 years, Mike Johnson, has help Buyers and Sellers in Greater New Haven, and across the state turn their dreams into reality. TAJ REAL ESTATE, LLC is a full service firm specializing in Short Sale, First Time Home Buyers, Sale and marketing of existing Home and Condos, Rentals, FHA 203K Sale and Renovation of Distress Properties, and Investor Purchase.
Mike Johnson is a graduate of Fairfield University, and a resident of Connecticut for over 38 years. He served on the Board of Directors for Hill Health Corporation from 1976 to 1984, has served on the Professional Standard Committee of the Greater New Haven Board of Realtors for over 8 years, served as Board of Directors for that organization from 2009-2012, and on the Farmington Canal Committee for over 10 years.
Mike possesses a high degree of knowledge, experience and integrity, and strives for excellence, as such creating a reputation second to none. Whether your Home is under water (owing more than the mortgage balance), or behind on your mortgage and facing foreclosure, your solution is only a phone call away. Pick up the phone and put your troubles in the hands of a experienced Realtor.
