Refinancing
When does refinancing actually make sense?
A lower rate is only half the story. Here’s how to weigh closing costs, your time in the home, and your goals before you refinance.
Priya Raman
NMLS #XXXXXX
Refinancing replaces your current mortgage with a new one. It can lower your payment, shorten your term or free up cash, but it isn’t free.
Start with the break-even point
Divide your total closing costs by your monthly savings. The result is how many months it takes to earn those costs back. If you plan to stay longer than that, a refinance may be worth a closer look.
Common reasons to refinance
Lower your rate or monthly payment
Switch from an adjustable rate to a fixed rate
Remove FHA mortgage insurance
Take cash out for renovations or to pay off higher-interest debt
When to wait
If you might move soon, or if the savings are small, the costs may outweigh the benefit. Our refinance break-even calculator lets you test different numbers before you talk to anyone.
General information
This guide is general education, not financial, legal or tax advice. Talk with a licensed loan officer about your situation.