When is time to refinance?

There used to be an old rule of thumb saying you should only refinance if your new interest rate will be at least two points lower than your current rate. However, with today's low closing costs, it's never the wrong time to think about a new loan. Refinancing has a number of benefits that often make it worth the up-front expenditure many times over.

When you refinance, you may be able to lower your interest rate and monthly payment. You might also be able to "cash out" some of the equity in your home, which you can use to make improvements or repairs to your home, consolidate debts, pay for a college education or take a vacation -- virtually any purpose you choose. Or, you might refinance to a program with lower monthly payments and use the monthly savings to pay off other debts or invest elsewhere.

There are costs to refinance though. This typically includes a current appraisal, title exam, processing and recording fees, and so on. These fees however, are typically financed in the new loan, resulting in little or no out-of-pocket expense and the cost to refinance is often made up very quickly in monthly savings. We'll work with you to determine what program is best for you, considering the cost to refinance, what effect it will have on your monthly cash flow and your long-term plans.