I was surprised at what I found. I started by contacting a major online lender advertising low rates and filled out an application. They came back with a 2. One downside to the offer is that it required points, which is a fee you pay to secure a lower interest rate. To get a 2.
We couldn't find an interest rate lower than our current one without paying that fee. My husband and I didn't want to use our savings to pay for points, so the lender offered to roll that amount into the mortgage, along with the other closing costs.
After our financial planner ran the numbers, he told us that it would take eight years to break even on just the points and closing costs.
Since my husband and I only plan on staying in this house for another 10 years or so, it didn't make sense to go through the hassle of refinancing. I was disappointed, but we did still have a low interest rate.
When you receive a refinancing offer, it's tempting to zero in on the interest rate and monthly payment. This couple refinanced their home twice in one year. Not just 2 refinances — 4. Sounds like a lot of work. On a similar note Dive even deeper in Mortgages. Explore Mortgages. Get more smart money moves — straight to your inbox. Sign up. Some may not see improved scores or approval odds. Not all lenders use Experian credit files, and not all lenders use scores impacted by Experian Boost.
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Experian websites have been designed to support modern, up-to-date internet browsers. Experian does not support Internet Explorer. When I was exploring refinancing, I went all in. I filled out piles of paperwork, researched lenders and spent hours on the phone.
Because we have a farm, our loan situation is also more complicated, so the process was incredibly daunting. Much to my surprise, they did. Our lender offered us something called an interest rate conversion. Although interest rate conversions are more commonly done when converting an adjustable rate mortgage to a fixed loan, Spaniel says there has been a recent trend of some lenders offering them in order to keep the loan — in some cases, with no fees at all.
In our case, the interest rate conversion made the most sense, allowed us to keep our lender with whom we have a great history and was the most straightforward process.
You may also want to explore if a mortgage recast might be right for you.
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