Thinking About Refinancing? Make Sure to Ask These Questions First

  • Heather Smith
  • 04/8/22

Interest rates may be rising, but they’re still low—and, as such, many homeowners may be considering refinancing their mortgages to lock in a lower rate.

Refinancing can be a great way to save money on your mortgage, but it’s not the right move for everyone.

So how, exactly, do you know if refinancing is the right decision for you?

recent article from realtor.com outlined key questions to ask before refinancing to determine if it’s the right financial move, including:

  • What are the closing costs? While refinancing can save you in the long run, there are costs you’ll need to cover at closing—typically 2 to 3 percent of the loan amount. Before you decide to refinance, make sure you know how much cash you’ll need to have on hand to close.
  • Are there any additional upfront costs? In addition to closing costs, some loans will have additional upfront costs (for example, insurance or a property survey). Before you commit to refinancing, make sure you have a clear understanding of any and all upfront costs you’ll incur.
  • How long is the loan term? When you refinance your mortgage, it’s essentially getting a new loan—and that means new loan terms. Generally, refinances have a loan term of anywhere between 10 and 30 years, so make sure the term aligns with your goals (and how quickly you want to pay off your home).

Work With Heather

For most families, choosing a new home is the biggest financial decision they will ever make. There are many complicated decisions involved in choosing a home. As one of the top real estate professionals in the local market, I'll negotiate the best prices and terms for you and answer all of your questions as they arise.

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