Here’s a good news for everyone: mortgage rates are low – and the situation isn’t likely to change anytime soon. The U.S. market is in a good spot for potential buyers. Consequently, it’s also an attractive time for those who have already bought their houses, as low mortgage rates bring about the idea of refinancing.
For many, the concept of refinancing is a good choice for cutting down on mortgage payments. It’s also pretty flexible, as you can choose rate-and-term or cash-out schemes. But, is refinancing worth it? Mortgage brokers in Salt Lake City say that the answer is a mix of yes and no, primarily because the practicality of refinancing rests on various circumstances.
The Ideal Scenario
Remember that the ideal scenario in refinancing is for the whole endeavor to pay for itself and yield some savings. With mortgage closing costs in the thousands, you should think twice and do the math before going in for a refinance. The best course of action is to identify when you would actually break even and how long it’d take.
Now that you have the breakeven point figured out, here’s another question: do you plan on keeping the house? If you plan on doing so even after you’ve paid off the mortgage, go ahead and refinance. If not, rethink your plan – you might be better off with the mortgage you currently have.
The Time for Decision
The real estate market sure changes rapidly, but you have to be careful with your decisions. Always remember that you’re dealing with a property here – and it’s by no means a small purchase. Think through your choices and do the math. A little number crunching goes a long way.
Keep these things in mind before you finalize anything. Strategize carefully to ensure you’re getting the most savings possible, sans the risk.