New Homeowner? How To Know When To Refinance 

We understand that the new homeowner smell on you hasn’t worn off, but we want you to know that it might be the right time to save you even more money on your mortgage.

Refinancing on your home might not have been on your radar at first glance but knowing the rates and when to take advantage of them should be important to you. When you were going through the mortgage process, it’s likely you heard the term ‘refinance’ thrown around a time, or two. But did you understand exactly what we meant?

Defining refinancing…

Refinancing is the process of financing your loan all over again but with different loan conditions.

The simplest explanation is that you are financing your property again. You are repeating the mortgage process you completed when you bought your home, only instead of buying a new home, you get a new loan. This new loan may have a shorter or longer term than you originally had. Your interest rate may be lowered. Your payment may be lowered. You may have access to equity you have in your home.

How to know if you should refinance…

When it comes to refinancing - it’s easy, really. You’re going to want to take advantage of the current interest rate that’s lower than the one that you bought with. Even if you don’t understand or know how to take the next step into refinancing, it’s worth reaching out to us to see if you should.

Even getting a 1 to 2% drop-in interest rates could make a huge dent in your monthly mortgage and could help you pay off your mortgage even sooner. Win? I think so.

Saving you money, course of action…

Alright, you’re on team refi. What do you do next? Since you’ve recently been around this block, you’ll need to apply again. So, you’re using that same documentation you used before, but this time you’ll have equity in your home and since you’ve become a pro at budgeting to get you in this home – you’ll still need to be in pretty solid credit score standing.

Just like the first time, the application will be submitted, it will get processed and thrown into underwriting again. The timeline might not be nearly as long as it was the initial go-round but you still should understand that there’s a lot that gets re-done behind the scenes. Saving you money does cost you, but not substantially. Depending on your loan program, you can expect to pay 3-6% of the loan amount.

Refinance closing costs might include: 

• Refinance application

• New home appraisal

• Title search 

• Home inspection fee 

• Lender’s attorney review fee 

• Origination fee 

• Points fee 

It seems like a lot that goes into it but think of all the years you’ll spend saving that money, our process is simple and streamlined! That lower interest rate can save you thousands and thousands of dollars year over year. Whether you’re a seasoned homeowner, or new to the game, refinancing is an investment up front that you’ll reap the benefits in for years to come. Call us today!