When is the Best Time to Refinance?
When is the Best Time to Refinance? When is the best time to refinance? The short answer is – it depends. Here are 3 of the most common times we see people refinance their mortgage. Refinance When Interest Rates are Low The most common reason that people refinance their mortgages is to take advantage of a lower interest rate. It doesn’t take a large change in your rate to see big savings – especially when you stretch out those savings over a few decades. For example, let’s say your original mortgage was for $350,000 and your interest rate was 4.5%. In that case, your payment each month would be roughly $1,773. Now let’s say the interest rates have dropped and you can get one for 3.75%. Assuming you still have a $350K mortgage, your monthly payments are now $1,621. So you’re saving $152 a month. Over the span of 30 years, that adds up to over $54,000 in savings! So even if the lower interest rate doesn’t seem to drop your payment by much, think about the long ter...