A: This could vary depending upon each individual’s situation. One thing to consider is how long it will take you to recover the closing costs. If you lower your payment by $100.00 every month and have $3,000.00 in closing costs, it would take you 30 months to recover. Most lenders won't refinance your home unless you recover within 48 months. As you can see in this example, you would recover your money in less than 3 years.
Q: How come some lenders offer loans with no closing costs?
A: All lenders can offer loans without closing costs. The refinancing costs can be paid by the lenders if you are willing to take a higher rate than what is available.
Q: I am upside down on my home, can I still refinance?
A: You might be able to. There are programs offered by Fannie Mae and Freddie Mac that are available to qualified homeowners that will enable you to refinance your home up to 125% of the appraised value of your home. EX: If you owed $150,000.00 on your home but your home appraised at only $125,000.00 you would still be able to refinance your home since you could get a loan amount for $156,250.00.
Q: Will my payments go way up if I shorten my terms?
A: Not necessarily. With a lower rate you may be able to cut years off your loan by increasing your payment just a few hundred dollars. Ex: If you drop your rate 1% and go to a 20 year loan, your payment will most likely increase by less than $100.00.
If you would like to have straight forward honest answers to your questions, please call me. I will help you refinance your home so you can enjoy saving money every month. Bay to Bay Lending in Tampa, FL is here to help you. Contact Laurie Toland via phone at (813) 642-7361 or reach out to me via email at firstname.lastname@example.org.
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