Q: We have 30-year FRM at 6.25% from 2004. The remaining balance is $123,000, while the value of our home is $220,000. We have excellent credit. Should we refinance?
A: Yes! You are a good candidate for refinancing. However, you should probably look at loan terms shorter than a 30-year term, which will see you re-start the "amortization clock" all over again. To lock in savings, consider a 20-year or even 15-year mortgage term instead; your monthly payment will only decline slightly (or perhaps not at all) but you will carve anywhere from four to nine years off your mortgage, saving a bundle of interest in the long haul. Of course, if improving your cash-flow is more important, a new 30-year term would work for you.
More help from HSH.com
What is a rate and term refinance?Homeowners have a variety of reasons for refinancing and each reason can indicate that one refinance option or another makes the most sense.
When refinancing at a higher rate makes senseTrade your old mortgage for a new, higher-rate version? There are times when it actually makes sense.
Should I pay off a mortgage early?By making extra principal payments or refinancing your mortgage, you could pay a lot less interest and free yourself from your mortgage ahead of schedule. Here are the pros and cons of retiring your mortgage early.
How does a refinance in 2017 affect your taxes?After a mortgage refinance, there are some specific "dos" and "don'ts" you need to know prior to filing your income taxes, as well as a few pointers that can help you lower your tax bite.