When is Refinancing Worth it?

Are you looking for a new mortgage loan? We will be glad to help! Give us a call at (401) 583-4150. Ready to get started? Apply Here.

It has been said that only in the case your new interest is at least two points under your current rate, should you refinance your mortgage. That could have been accurate a while back, but as refinancing has been costing less recently, it is never the wrong time to explore the options of a new loan! A refinance is often worth its cost several times over, factoring in the benefits that come, along with a reduced interest rate.


When you refinance, you could be able to reduce your interest rate and monthly mortgage payment , sometimes by a lot. You might also have the ability to "cash out" some of the built-up equity in your home, that you may use to consolidate debt, make home improvements, or plan a vacation. You might have the option to refinance to a shorter-term mortgage loan, giving you the ability to build up your home equity quicker.

Expenses and Fees

As you probably expect, you will have some fees and expenses during the process of refinancing. You will be charged the same types of expenses and fees as you did with your present home loan. Among these can be settlement costs, appraisal fees, lender's title insurance, underwriting fees, and others.

Do the Math

You might think about paying points to get a reduced interest rate. Your savings over the life of the mortgage may be substantial if you have paid up front about three percent of the new loan balance. Please talk to a tax professional before acting on hear-say that the paid points can be deducted on your taxes.

Another expense that borrowers may consider is that a lower rate of interest will lower the interest amount you will be able to deduct on your taxes. We can help you do the math! Call us at (401) 583-4150.

In the end, for most people the amount of up-front costs to refinance are paid back very quickly in monthly savings. We'll help you determine what loan program is ideal for you, considering your cash on hand, how likely you are to sell your residence in the near future, and the effect refinancing will probably have on your taxes. Call us at (401) 583-4150 to get started.

Curious about refinancing? Give us a call at (401) 583-4150.

Got a Question?

Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.

Your Information
Your Question