Wondering when the best time is to refinance your home? There are many factors to consider when deciding if refinancing is best for you. Whether it’s the time of year or the stage of your home ownership, refinancing could be beneficial. I joined THV11’s Tom Brannon to talk about why you should consider refinancing your home before this summer season.
National Homeownership Month is June, so it’s no surprise that summer is a big selling season for real estate, when market prices are often lower. However, lower market prices affect the value of your home and refinancing during summer can negatively affect your rates.
Currently, rates are at a historic low in relation to the state, of the economy and inflation. It is expected that rates will increase to just below 4 percent by the end of the year with a 30-year rate rising up above 4 percent in 2014. But right now, refinancing is a great option if it fits your home owning needs.
Before refinancing your home you should ask yourself, “How long do I plan on living in this house?” If you answered 2 years or less, then it may not be worth the time and money to refinance. Other factors to consider are your current rate, to the amount of your mortgage and how many years remain in your loan. You should be aware of your finances and credit score, too. Has your credit improved significantly over the course of your current mortgage? Have you been making payments consistently and on time? Do you have the resources to easily pay closing costs and refinance fees? These are all considerations before you make the decision on whether to refinance.
Here are some important reasons to consider refinancing your home:
- Lower your monthly payment
- Get the mortgage paid off sooner and build equity
- Convert to a different loan program
- Capitalize on improved credit
- Get rid of the private mortgage insurance
- Cash out a portion of the home’s equity
Refinancing your home is a serious decision, so take the time to consider if it is right for you.