Mortgage Basics>Refinance

Refinancing Your Home

Refinancing is the process of taking out a new mortgage and using the money to pay off your current mortgage to either get a better interest rate or to get cash out to pay off other debt.

To refinance: you apply, undergo a credit check, title search, appraisal, inspection, etc. You will incur closing costs but these costs can be packaged into the mortgage by increased loan amount or increasing the interest rate, so you don't pay any out of pocket costs up front.

The rule of thumb for refinancing is that interest rates should be at least 1.5% - 2% below the rate of your existing mortgage, for a rate and term refinance, otherwise, your monthly payment won't be reduced enough to make up for the costs of refinancing. But every scenario is different.

We can help you determine if refinancing is a good strategy and reason based on your situation.

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