How long do I plan to stay in this home?5 of 8Mortgage professionals generally tell borrowers to expect a home refinance to cost 3 percent to 6 percent of the loan amount. A simple calculation shows how long it will take to reach the break-even point when the savings outweigh the costs."If the break-even is at 15 months and you plan to stay in the home for five years or longer, it is probably worth it to refinance," Cunningham says. "But if you plan to move in two years, it may not make sense."Meshel says long-term homeowners who are close to paying off their mortgages might not want to refinance because of the costs incurred. Related Articles:N.Y. tops in closing costsFHA changes mortgage rulesHow to derail a refinanceHow to kill a loan closingRelated Links:7 reasons to refinance5 keys to mortgage ratesLenders want tax returnsFAQs on mortgage refis advertisement
Mortgage professionals generally tell borrowers to expect a home refinance to cost 3 percent to 6 percent of the loan amount. A simple calculation shows how long it will take to reach the break-even point when the savings outweigh the costs.
"If the break-even is at 15 months and you plan to stay in the home for five years or longer, it is probably worth it to refinance," Cunningham says. "But if you plan to move in two years, it may not make sense."
Meshel says long-term homeowners who are close to paying off their mortgages might not want to refinance because of the costs incurred.
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