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Mortgage Refinancing in Florida – Should you refinance or not?

If you bought your home when mortgage rates were low as many have in Florida, you may have no interest in refinancing your present loan. But if you bought when rates were higher or you’re sitting with an adjustable-rate mortgage loan, refinancing may help lower the monthly payments.

Should you refinance?

If you choose to refinance, the process looks a lot like the steps you followed in obtaining the original mortgage. In reality, refinancing a mortgage is simply taking out a new mortgage. You’ll encounter many of the same procedures - and costs - the second time around.

Would Refinancing Be Worth It?

Just because you see a lower interest rate doesn’t mean refinancing makes sense to your situation. As a general rule, if the current interest rate on your mortgage is at least 2 percentage points higher than the current market rate – refinancing makes sense.

You must balance the costs of refinancing a mortgage against the savings you’ll receive.

Other considerations to refinancing

How long you plan to stay in the house. Most sources agree that it takes at least three years to fully realize the savings from a lower interest rate and the costs of the refinancing.

Refinancing can be a good idea for homeowners who:

• Want to get out of a high interest rate loan and take advantage of lower rates. This is a good idea only if they intend to stay in the house long enough to make the additional fees worthwhile.
• Have an adjustable-rate mortgage (ARM) and want the certainty of knowing exactly what the mortgage payment will be for the life of the loan that a fixed-rate loan provides.
• Want to convert to an ARM with a lower interest rate over the ARM they currently have.
• Want to build up equity quicker by converting to a loan with a shorter term.
• Want to draw on the equity built up in their house to get cash for their children's education or a major purchase.

If you decide that refinancing is not worth the costs, ask your lender whether you may be able to obtain all or some of the new terms you want by agreeing to a modification of your existing loan instead of a refinancing. If you’re looking for a new lender some of the best mortgage refinancing rates in Florida, or anywhere in the country are found online.

Does a mortgage refinance make sense? In the end you must make the final decision, for you, your family, and your finances.

For more information on refinance in florida, or other financial matters visit the links below.