Filed under: refinance.
The truth about refinancing is that for most people there is no perfect time. There is no time where it doesn’t cost a penny and there’s no paper work involved. Instead, it’s a matter of weighing the pros and cons. Do you want to save money on your monthly premiums? Of course, but is it worth the upfront costs of refinancing? Some companies will roll those costs into the mortgage so you won’t feel them at first, but they’re still there. You also need to ask yourself if interest rates are as low as they’re going to go. They’re certainly at historic lows now and experts don’t expect them to get any lower.
Other questions you should consider before refinancing your home mortgage are about your current financial situation. If you don’t expect it to change in the near future then it makes sense to apply for a refinance now. However, if you expect to get a raise in the next year, or if you’re working on your credit and it’s improving, then it may make sense to wait for those situations to arise. Lenders will look at your last 12 months of mortgage payments, so it’s wise to wait to apply until you have a period of time where the last 12 month’s mortgage payments were paid on time.