Interest rates continue to hover near historic lows, and despite the surge in refinances last year, Black Knight – a mortgage technology and data company – estimated that over 19.4 Million households could still benefit from refinancing as of December 2020.  One of the most common questions we are asked is ‘how do I go about refinancing my mortgage?’.  When you refinance, you are truly originating a new loan, and the proceeds from that loan will pay off your existing mortgage.

To gauge your options the first step is reaching out to a lender you trust. You will want to be ready to provide a recent mortgage statement and a sense for how much you think your property is worth.  If you are not sure about the value of your home, reach out to us for comparable sales and a general sense of where we think it could appraise. From there the lender should be able to provide you with a detailed cost-benefit analysis so you can decide if it’s worth applying. We are seeing some scenarios where a new appraisal is not even necessary – saving on the cost of an appraisal will shave about $500 off your closing costs.

Most people traditionally think about reducing their monthly payment when refinancing, but it’s important to be clear about your goal.

Perhaps you want to take cash-out for home improvements or debt consolidation.  Maybe you want to move to a shorter amortization period such as going from a 30 to a 15-year fixed.   No matter your goal, it is worth at least exploring your options in the current interest rate environment.

Housing remains critical to our economic, social and physical well being during this pandemic. Refinancing, buying or selling in this market is an intensely personal decision. If you are considering refinancing or need to make a move then reach out for a confidential virtual consultation.