At some point home owners will begin thinking debating about selling or refinancing their home. Let’s look at both options. Why refinance? Typically it’s a financial decision. The lender will offer you a lower rate and promise great savings. Consider the following: Nothing is free and although there may be no costs out of pocket, they will be added to the total loan amount plus interest. We are talking about at least 2%-2.5% of the loan. How many payments before the break even point is reached? If refinancing costs $5000 and savings are $200/mo, break even is 25 months. Anything close to two years or less makes refinancing a good choice. However, also consider that if you are refinancing to another 30-year loan, you are losing the months paid into the loan. With increased appreciations, getting rid of mortgage insurance is an additional benefit.
Deciding to selling and buy will be more about lifestyle changes requiring an upgrade or downgrade from your current home. Consider location, family needs, your future plans and yes, new financing terms. The ability to use proceeds from the sale for a larger down payment will help with the new payment. Finding a new home must be a contingency in the sale of your current home. Those who are able to relocate to an area where the market is less inflated have the greatest to gain from selling and buying.
Can I assist you with your real estate needs? Just email at email@example.com or text 720-253-8513.