Refinancing a Mortgage - and Beating Today's Market

By
Real Estate Agent with Realty One Group # S.0190863

Refinancing a mortgage. Yes, some folks are considering that after the last year. When rates are low, it can seem like the ideal time to refinance your mortgage. After all, who doesn’t like a lower interest rate? There are lots of good reasons to refinance your mortgage, such as adding on or trying to streamline your expenses, but what’s really involved in the process?

 

Refinancing a Mortgage: The Basics

Perhaps the best news any homeowner can get when it comes to a refi is that it’s not likely to be nearly as difficult as getting the original loan was. Breathe a big sigh of relief if you need to; this is the time for it.

Many homeowners look to refinance for a few specific reasons. These may include reducing mortgage interest, dropping mortgage insurance, or cashing out for a remodeling expense. When rates are low and values are high, a refinance can provide a dual benefit. Dropping any mortgage insurance you’re currently on the hook for can make a big dent in your house payment. This is especially true when waiting for it to fall off naturally would take several more years. And, of course, a lower interest rate also means you’re paying less money towards interest over time.

When you combine the two and it can mean big savings. Especially when it's a home you plan to hold over the longer term. Remodeling may be a valid and effective way of adding value. Which is another reason some owners choose to refinance. In short, there are tons of ways a refi can be helpful to your financial welfare.
Related: What is a HELOC?

 

Marry the Home and Date the Rate

A new term folks have used about refinancing a home is "Marry the home and date the rate". This is a concept rapidly gaining favor.

In short, buy the home now - even if you feel rates are high. If rates go even higher, then you saved yourself a lot of money. However, if rates come down, refinance at a lower rate (which would generally means higher sales prices anyways) and benefit that way. Either way, you come out ahead and own the home you want.

According to Charity Bond of EPiQ Lending, “We have a great program for those who want to ‘date the rate’. It’s called 'Rate Rebound'.     -    For the rest of this article, please CLICK HERE 

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Comments (5)

Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Hi Rocky - I haven't heard the term, "marry the home and date the rate before"  but long terms owners will do that.

Nov 27, 2022 05:09 AM
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Rocky. While I am not sure of the phrase "marry a home and date the rate", I was guilty of that in the 80's when rates were close to 20% and involved points for the privilege. Enjoy these artificially low rates.

Nov 27, 2022 05:27 AM
Bill Salvatore - East Valley
Arizona Elite Properties - Chandler, AZ
Realtor - 602-999-0952 / em: golfArizona@cox.net

Thank you for the post, I enjoyed it. Have a wonderful Sunday, it all starts back tomorrow.  Bill

Nov 27, 2022 05:40 AM
Lise Howe
Keller Williams Capital Properties - Washington, DC
Assoc. Broker in DC, MD, VA and attorney in DC

Great advice for everyone - nothing is as bad as it seems if you work with the right people 

Nov 27, 2022 06:50 AM
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Rocky this is not a good refi market.  Most people with higher rates refinanced before the interest rates shot up this year.  However, depending on how high the PMI payment is it may still be an advantage to get rid of it, even at a higher rate.  Also even at today's rates, refinancing to do renovations to the home, is still a better choice than charging those improvements on credit cards.

Nov 27, 2022 03:23 PM