Homeowners everywhere need to save money. Their has been a lot of talk recently about mortgage refinancing and its potential to save a homeowner a lot of money on their home loan. Mortgage refinancing, depending on your personal finances, can be a good or bad decision. Here, I have included some tips which will help, and could save you a lot of money, should you decide to refinance your home loan:

1)Mortgage Refinancing with Points or without Points
Lowering interest rates should be the ultimate goal of a homeowner who is looking to save money. Homeowners will need to figure out the benefits of paying points up front, versus having a lower interest rate. Depending on what you choose, and how long you plan on living in your home, you need to figure out the benefits taking these factors into consideration.

2)Mortgage Interest Rate Games
Do not be a victim for mortgage lenders who advertise 0% interest rate home loan refinancing. Typically, these mortgage lenders will try to get you into a low interest arm (adjustable rate mortgage) loan, which will inevitably skyrocket in the future, and leave you in a bad financial spot, again.

3)Watch out for hidden fees and costs associated to refinancing your home loan.
If it seems like the new mortgage rate you are able to get is much lower than you thought it would be, there is probably a catch. Make sure to find out how much all associated closing costs and fees are prior to signing and mortgage refinancing deal.

4)Get a “Good Faith Estimate”
A good faith estimate is a document which is a valid quote for a mortgage which is valid for 3 business days. Take this time to carefully review and compare your potential mortgage to other lenders options.

5)Know how long you plan on living in your home.
Sometimes the costs of refinancing a home loan can be outweighed by the savings if a homeowner is not planning on living in the home for an extended length of time. Typically 6 years is when homeowner breaks even and will start to see savings from refinancing a home loan.

-M Petrone

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