The Truth About Refinancing Your Mortgage (& What to Know)
The historically low-interest rates were intended to keep home buying up.
Still, it also opened the door for incentivizing homeowners to refinance their mortgages and lock in super low rates.
However, this leads to a few questions: Is it always a good idea to refinance? And, what is the truth behind refinancing your mortgage?
Not every financial move makes sense, and this includes refinancing. Refinancing could be the right move for you, or it could be the wrong move.
Brian Scott, a senior loan consultant outside of Washington, D.C., put it this way, “The downside of refinancing would be the equity you give up to pay the closing costs and the potential term resetting.”
Scott elaborates that while it is typically advantageous to refinance, you want to make sure you can recoup your closing costs in at least a five-year window. Put another way, the purpose of refinancing is to save money, not to lose it.
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