I talk to people every day that are interested in seeing if it makes sense for them to refinance and sometimes I actually tell them no. I know that it is hard to believe but everyone that wants to refinance, should not do it.

There are some “rule-of-thumb” guidelines out there that people have been hanging on to over the years. For instance, “If you can’t get at least 2% reduction in rate, it isn’t worth doing.” Sometimes that is correct and sometimes it isn’t. If you have a $50,000 loan, it probably will not be cost effective to reduce your rate by 2%, whereas, if you have a $350,000 loan, it may be worthwhile to reduce your rate by 1%.

Every circumstance is different, and that is why you should work with a knowledgeable loan consultant. Maybe it would be the right thing for you to refinance to a shorter term. Maybe it would make sense to take cash out of your home, assuming you have any left in it. Take a look at this discussion from Fox Business News:

http://video.foxbusiness.com/v/4312379/home-refinancing-rates-surge/?playlist_id=87185

Also, it is a good idea to shop around, not only for rate and fees but also for the right company and loan consultant. Just because someone promises the lowest rate, doesn’t mean that you will get the best deal, but if someone is promising you something that sounds too good to be true, it probably is. Then there are those companies that are advertising out there that make what they are offering sound so wonderful that you should jump right on it when in reality, it isn’t even competitive in the market place. Watch out for adjustable rates masquerading as fixed rates in advertising.

Look before you leap and find out what you can about your choice. Are they established? Are they local? (National telemarketers and advertisers have to pay for that somehow.) Are they competitive? Are they honorable? Can they close in the time they want to lock? Will they tell you that you shouldn’t refinance when it doesn’t make sense to you? Or are they only after that next loan? Are they licensed? Do they have references? Do they know what drives interest rates?

Contact me

Navigating the mortgage approval process can be daunting. You need someone on your side. I am available right now to help you with the loan process and know the ins and outs of FHA, VA, USDA and conventional financing. If you want to buy a home using an FHA loan or refinance using VA, I am here to help. Contact me at Alpine Mortgage Planning, 1200 Executive Pkwy., Ste. 100, Eugene OR 97401, 541-342-7576/541-221-3455 cell or by e-mail. Only you can make the choice it is time to get the process started.