The ultra-low interest rate environment, has given thinking of refinancing the mortgage, for many. But, it is a topic that tends to come up a lot, and all refinancers ask first “what are the best mortgage rates today”? But, before trying it out, you should consider the below things about how the refinancing process works.
Break Even Period
If you’re going the traditional re-financing way, you need to pay closing costs. So, calculate well your break-even period in order to determine if, refinancing even makes sense for you. It may not be a great deal if your payment will be lowered in closing costs.
Paying Points to Lower Your Rate
Pay points are one thing that you can do to get an even lower monthly payment. It will lower your interest rate but, may also increase your break-even period. You should make a careful analysis of all the possible situations. Do you know “what are the best mortgage rates today”? So, how can you predict when rates will go up or down? Hence, the one creative solution is a no-cost refinance.
Look for No Cost Refinance
You can look for many a mortgage refinancing in Delaware that is willing to do free no cost refinance. They will collect interest on your loan for up to the next 30 years. This is the reason they’re so motivated to get your business. Banks are paying the closing costs up front, to reap the tens of thousands in interest which you might pay during the course of their mortgage.
Be Careful of Lenders
Always be careful of lenders who try and tie closing costs into the loan. These loans might have tag-line of “no cost to you”. Make sure you’re getting a no-cost refinancing by comparing the loan balance to the amount shown on the loan estimate.