How a Refinance Can Drive Down Your Monthly Expenses

Mortgage and Lending with Guaranteed Rate, Marin County, CA NMLS: 22343

How a Refinance Can Drive Down Your Monthly Expenses


While all real estate may be local, so too is it true that one homeowner, confronted with the opportunity to save $250 per month through refinancing, for example, may view that as a significant financial relief while another may feel it's not even worth it to get off the couch to consider going through the hassle of the loan process.  As we work into the second half of 2019, there is no mistake that the low rate environment we are enjoying again is providing opportunities for homeowners to refinance.  Often in these cases, having an open mind about any level of savings can help us determine whether or not a refi is "worth it."  Here in the San Francisco Bay Area, if we take an average loan size and make some assumptions on monthly savings through a refinance at today's rates, we see that it's not unreasonable to think that our clients can save between $150 and $350 per month.  When you look at this in relation to the most significant household budget expenses; auto loans, student loans and credit car payments, it's easy to see why a careful review is a great idea.  Need more proof?


As of 2018, it is estimated that 44% of American adults have a car payment.  On average these individuals owe over $30K on their auto loan and they pay over $500 per month on their payment.  Interest rates vary but with an average FICO score of 695, you can bet your bottom dollar that some of these merry motorists are not enjoying 1% interest rates on their auto debt.  It's possible today's refinance could cut your auto payment in half --- or at least that's the way it would feel until the car is paid off.


The average student graduates (or not...) college with about $25,000 in student loan debt.  It's estimated that the payment on this would hover around $280 per month.  Owning a home is a big financial responsibility.  Owning it alongside student loan debt can turn it into a financial burden that refinancing might ease.


Depending on what stats you review, it's estimated that the average American carries between $4000 and $7000 per month in credit card balances that roll from month to month.  And you can be sure that as this revolving debt ages, the interest rate on it does not suddenly get better.  To break this cycle, a refinance can provide needed monthly budget space to slash the credit card balances and get off the minimum payment treadmill.


Bear in mind that in each case above, I am not advocating that our clients take on more debt!  We are not suggesting that they do a cash-out refinance and pay off these other obligations.  That may prove to be a good strategy and might warrant further examination.  But even in cases where a borrower simply does a "rate and term" refinance and lowers the rate and payment on an existing mortgage, the savings that result can go a long way to comprehensively addressing the other components of any household budget.


We're here to help when you're ready to look under the hood, roll up your sleeves and do the work.


My uncle has a country place, 



Robert J. Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959


Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate's Human Resources Department.


Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood ChicagoIL 60613 - (866) 934-7283


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  1. Lottie Kendall 08/15/2019 07:59 AM
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Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

More great advice and food for thought from Rob Spinosa 

Aug 15, 2019 07:54 AM #1
Anna Banana Kruchten CRS, CRS, Broker, Instructor
HomeSmart Real Estate BR030809000 - Phoenix, AZ

Rob really good discussion on the pro's/con's of refinancing a mortgage. The best thing to do is consult with a local professional (YOU)! I hear the buzz word 'refi' almost every day this past month or so. At such low rates it just might make sense for some folks.

Aug 15, 2019 10:37 AM #2
Dana Hollish Hill
Hollish Hill Group, KW Capital Properties - Bethesda, MD
REALTOR and Productivity Coach

You are so right. What may make sense today, could cause you to have a short sale on your hands. It is so important to talk with a lender to discuss one’s individual situation.

Aug 15, 2019 05:22 PM #3
Diana Dahlberg
1 Month Realty - Pleasant Prairie, WI
Real Estate in Kenosha, WI since 1994 262-308-3563

Really liked your informative and thought-provoking blog.  When you think about these areas of saving it makes me wonder why a person would not be calling their lender today to reorganize and refinance and see the savings that could be realized.  Good stuff!

Aug 15, 2019 06:56 PM #4
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Do the job....with Rob

Aug 16, 2019 06:29 AM #5
Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

You make such good sense with this post, Rob.  The rates are amazing right now and I have lots of clients who have called me to suggest lenders for a refi. Some have been in their homes less than a year...guess it's these historic rates are getting their attention. D

Aug 17, 2019 06:20 AM #6
Sham Reddy CRS
H E R Realty, Dayton, OH - Dayton, OH

Thanks for sharing!

The average student graduates (or not...) college with about $25,000 in student loan debt.  It's estimated that the payment on this would hover around $280 per month.  Owning a home is a big financial responsibility.  Owning it alongside student loan debt can turn it into a financial burden that refinancing might ease.

Aug 17, 2019 09:59 AM #7
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Real Estate Agents - Luxury - Divorce

A couple years ago we got a newly married couple into a home with a higher interest rate because they had no credit....and we showed them how to build it. A couple weeks ago...they closed on the refi we introduced them to and saved a hefty $500 a month !

Aug 18, 2019 05:03 AM #8
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

Those with $7000 dollar credit balance are potentially the first group to experience default. A lot Americans just don't learn.

Aug 18, 2019 06:53 AM #9
Lynn B. Friedman
Atlanta Homes ODAT Realty Call/Text 404-939-2727 Buckhead - Midtown - Westside -- and more ... - Atlanta, GA
Concierge Service for Our Atlanta Sellers & Buyers

Rob Spinosa 
Hope you are well. Lots of good information here and a clear reminder:
"As we work into the second half of 2019," 

All the best - Lynn

Aug 18, 2019 10:30 PM #10
Monique Ting
INET Realty Honolulu, HI - Honolulu, HI
Your agent under the sun

It is sad to know that people nowadays have more debt than 20 or 30 years ago when the mortgage interest rates where in the double digits! And the worse thing is that while mortgage interest rates have gone to historic lows, the credit cards interest rates and even personal loans are still high. So it makes perfect sense to refinance one's mortgage if possible...

Aug 19, 2019 10:05 AM #11
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Rob Spinosa

SVP of Mortgage Lending, Marin County
Can I Get a Jumbo Loan with 10% Down?

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