Avoid Refinancing More Than Once?

Article Posted by Expert Author: Tony Caro  on 09/09/2013

Refinancing a mortgage can be a very wise plan when you are trying to save money on interest rates and terms. However, you never want your refinancing plans to ever prove self-defeating and end up costing you more money than what you would save. Among the most common ways people end up “cheating” themselves in the refinancing process would be to repeatedly refinance a mortgage with different lenders. Depending on the lender you choose, and especially if you are refinancing with your current lender, you may only be charged minimum to no closing costs, which can be very beneficial.  However, there may be other fees and expenses associated with the process as well, like appraisals to determine the home's value.

Certainly, it would be more than a bit difficult to save money on your mortgage if you kept engaging in costly refinancing over and over again. If you have already refinanced once you may wish to avoid doing so again unless you have carefully discussed the matter with a Dallas refinance home mortgage expert.

Such an expert would advise you that if you continued refinancing every few years and resetting the terms at 30 years, you may end up paying so much in interest over the course of decades that any perceived benefit you may have gained from the refinance has essentially squandered your wealth.   However, if you are smart about a refinance home mortgage, you may be able to take advantage of certain scenarios that become available to you at different times.  For instance, right now interest rates are unprecedentedly low (and will remain so likely for the next few years).  While you may have refinanced your loan say six years back, a refinance coupled with dropping the loan duration from say 20 years down to 15 years would save you substantially over the duration of the loan.  That's a smart scenario for going through the process again.

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