How Do You Know When To Refinance?

The age old question of when is the best time to refinance your home loan may never be answered because the answer depends on you and your specific situation. There are, however, some general guidelines you can follow to help you decide if now is the right time for you.

Are rates low? That’s the million dollar question because if they’re not you could regret your decision to refinance for the next five or ten years. If you think rates are likely to continue dropping this may not be the right time to get that loan.

If, however, rates are going up or you think they’re are about to, it would be wise to lock in on a rate before they go up further and potentially price you out of the game.

What do you need the money for? Why you’re shopping for a refinance loan in the first place can play a role in whether it’s a sensible idea. If you want to lock in at a good rate and pull cash out of your home to take a luxury cruise, that might not pass the “smell” test. But, if you’re refinancing to lock into a fixed rate mortgage to save money on your house payment, that’s another story entirely.

Refinancing becomes an even more attractive option for you if you want to reduce your payments so you can eliminate existing high interest debts, potentially saving thousands monthly.

In real estate, it’s location, location, location. When timing a home refinance loan, the question seems to be “How about now?” Only you can answer that question.  Just make sure it passes the smell test!

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