Weighing the Options of Refinancing

In the market for a new mortgage? We can assist you! Give us a call at 425-508-9988. Want to get started? Apply Here.

Ever heard the old rule of thumb that states you should only refinance if your new interest rate will be at least 2 points lower than your present one? Perhaps that was good advice a number of years ago, but as refinance costs have been falling recently, it may be time to take a serious look. Refinancing has various benefits that will often make it worth the up-front cost several times over.


When you refinance, you might have the ability to lower the interest rate and monthly mortgage payment amount, perhaps significantly. You also may have the option of tapping into your home equity by "cashing out" some money to fix up your home, consolidate debt, or plan a special vacation. You could be able to refinance into a shorter-term mortgage, enabling you to add to your home equity faster.

Expenses and Fees

All of these advantages do come with some expense, though. When you refinance, you are paying for basically the same things you paid for during your current mortgage. Included in your costs can be an appraisal, underwriting fees, lender's title insurance, settlement costs, and other fees.

Doing the Math

Paying discount points can result in a lower interest rate. When you pay (on average) 3% of the loan amount up front, the savings for the term of the refinanced mortgage loan can be substantial. You may have heard that the points can be deducted on your income taxes, but as tax regulations are ever-changing, please consult with a tax professional before considering this in your calculations.

Another cost that borrowers might take into account is that a lower interest rate will reduce the interest amount you will deduct on your taxes. Call us at 425-508-9988 to help you do the math.

All things considered, for most the total of up-front costs to refinance are paid back very quickly in monthly savings. We can help you figure out your options, considering the effect a refinance could have on your taxes, how likely you might be to sell in the near future, and your money on hand. Call us at 425-508-9988 to get you started.

Want to know more about refinancing your home? Give us a call at 425-508-9988.

Get a Refinance Quote

Looking to refinance your home? Fill out the following form to get a fast quote from us.

Contact Info
Property Information
Mortgage Information