Rule of Thumb: When Is It Time to Refinance?
As long-term interest rates continue to drop, home owners with higher rates are seizing the opportunity to refinance their home.
But when does a homeowner know that it is the right time to refinance? An UrbanTurf reader recently wrote in with the following question:
“When should you start thinking about refinancing? Say, for instance, you have a 30-year loan at 5 percent. Is there conventional wisdom or a good refinancing calculator out there that says ‘if you can refinance at X.X% with $$$ of closing costs and X number of years left on the loan’, then you should do it?”
BB&T mortgage loan officer Matthew Rexrode offered up the following:
“A good measuring stick for when to refinance is to wait until rates are about 1 percent lower than your current rate. This can vary depending on your loan amount, though. If the balance on your loan is $150,000 or less, you probably want to wait until rates are a little more than 1 percent lower. If your loan balance is over $400,000, though, it’s worth looking into refinancing when rates are around 0.75 percent lower than your current rate.”
As for online calculators, Rexrode said that he uses the one on HomesLoanSocial.com, noting that it can give you a good sense as to when it is time to reach out to a loan professional to go over your options.
See other articles related to: mortgage rates, mortgages, refinancing, rule of thumb
This article originally published at https://dc.urbanturf.com/articles/blog/rule_of_thumb_when_it_is_time_to_refinance/3649.
Most Popular... This Week • Last 30 Days • Ever
DC's homebuyer assistance programs can be a bit complex. This edition of First-Timer ... read »
In this article, UrbanTurf looks at the estimated annual maintenance costs associated... read »
Today, UrbanTurf is examining one of our favorite metrics regarding competition in th... read »
The residential development in the works along Florida Avenue NE is looking to increa... read »
Another concept has been unveiled for one of DC's most contentious development sites,... read »
- First-Timer Primer: DC's Home Buyer Assistance Programs
- What Are the Annual Maintenance Costs When You Own a Home?
- The 6 Places In The DC Area Where You Aren't The Only One Bidding On a Home
- 46 to 48: The Biggest Project In Trinidad Looks To Get Bigger
- A First Look At The New Plans For Adams Morgan's SunTrust Plaza
DC Real Estate Guides
Short guides to navigating the DC-area real estate market
We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Start browsing below!
First-Timer Primers
Intro guides for first-time home buyers
Unique Spaces
Awesome and unusual real estate from across the DC Metro