How Many Times Can You Refinance a Mortgage?
posted October 10, 2009 - 2:55pmIf you’ve recently refinanced and your situation or the interest rates have changed, you may be considering refinancing again.
So how many times can you refinance a mortgage?
It is possible to refinance home mortgages as
many times as you would like, but there are some general guidelines to go by so that you know that your decision to refinance again or not is made in your best interest.
1: Short Term Benefits
Having a lower monthly payment than you have now is great, and can definitely help when it comes to paying the bills and breathing a little easier every month. But will you be paying more in the long run with added refinancing costs?
2: Credit
Checking your credit before you refinance again is a good idea. You can make sure that there’s nothing on there that will adversely affect your interest rate, and you can make sure that your most recent refinance has shown on your report. If there is too much going on with your credit report, you may want to consider waiting to refinance again.
3: Interest Rate Market
If the interest rates have gone down quite a bit since your last refinance then it may be worth considering another refinance, but only if the long term benefits of doing so will pay off.
4: Long Term Benefits
The costs of refinancing can be in the thousands of dollars, so if you won’t be saving more than you’re paying to refinance, then it really isn’t worth it in the long run. However, if you WILL be saving more than you’re paying out for the closing costs of your new home loan, then it should be considered.
5: Talk to a Specialist
Talking to a refinancing specialist at a bank or home lending institution who regularly refinance home mortgages will put you on the same page as those who would be giving you a loan. They can also help you do the calculations to make sure that a refinancing of your loan is beneficial for you, both in the short term and the long. Many banks have their own requirements as to how much time should have passed between your last refinance and your next.
Refinancing may sometimes look good in theory or on paper, but in practice may not be as helpful as it seems. Make sure to do the proper research and talk to the right people before making a big decision such as the refinance of your home.
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