When You Should/Shouldn't Refinance Your Mortgage

ISLAMORADA, Fla. - Nov. 21, 2017 - Rezul -- Per Jan Keller, Top Producing Real Estate Agent for Coldwell Banker Schmitt Real estate and owner of Kellerporterteam.com-Everything about Real Estate in Islamorada and the Upper Keys," that is the only possible trend. However, it is likely or probable that home loan interest rates will continue to incrementally rise. But, this shouldn't be the sole reason to jump into a refinance.

What's more, it's very important to know about a very basic misconception. Refinancing isn't redoing a mortgage or modifying an existing mortgage, it's getting an entirely new home loan. Now, let's look at five key things to consider about refinancing your mortgage:

●      What are the available products? As mentioned, refinancing means applying for a new home loan. It is not simply "redoing" your existing mortgage. So, you need to examine all available options. The best are fixed-rate traditional, conforming mortgages. FHA fixed-rate is a little more pricey but still quite fair. However, adjustable rate, balloon, jumbo, and even VA mortgages aren't nearly as good a deal. If possible, stay away from these and USDA loans, as well.

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●      How long do you plan to stay put? As a rule of thumb, if you're going to stay in your house for four to five years or more, it's generally worthwhile to refinance. But, this isn't always the case. For instance, if you just move down a quarter point but can put a little extra toward the principal each month, it's probably better to focus on amortization through extra principal payments.

●      What costs must you pay out of pocket? Since refinancing is getting a whole new home loan, that means you'll pay all those fees known as closing costs. Sure, you can roll the closing costs into your monthly mortgage payment. But, do you really want to finance a few thousands of dollars on top of the principal?

●      What's your home equity/appreciation? Another consideration is your home's equity position and its appreciation rate. If you have enough equity and your property is appreciating well, it might be a good idea to refinance if you're getting a lower rate.

Lastly, how is your credit? After all, you are applying for a new mortgage. So, if your credit score isn't good, you'll pay more.

For more information about Luxury Homes for sale in the Upper Florida Keys, please contact Jan at http://www.islamoradajan.com