Many clients will look into refinancing to save money.  There are generally two main goals in refinancing:

1. To lower your monthly payment
Many times client want to reduce their monthly payment to give them greater flexibility in their monthly budget.  However, when looking at refinancing, you want to make sure you are considering what is causing your payment to decrease.  Is your payment decreasing because you are taking a longer term loan? If that is the case, your overall cost to borrow may have actually increased. In some cases, you can refinance, keep a similar or shorter loan term and reduce your monthly payment.

2. To reduce the amount of interest paid on your loan
This can often times be accomplished by shortening the term of your loan.  Keep in mind, the shorter your loan term, the higher your monthly payment will typically be. However, interest rates are typically better for loans with shorter terms.

While it is possible to shorten your loan term and decrease your monthly payment, you generally would need to see a strong difference between your current interest rate and the interest rate on your new loan.

When looking at refinancing, you will also want to look at what your closing cost are, how much you would save and how long it would take for you to make back what it cost you.  In some cases, even though current interest rates may be lower, it may not make sense to refinance. We will help you review the numbers in detail to make sure refinancing makes sense.  If it doesn’t, we will tell you.  The last thing we want you to do is refinance your home only to receive no financial benefit.