As interest rates continue to plummel, many homeowners have financed at least once over the past 3 years… some two times, and I’m comtemplating refinancing for a THIRD time already!! Yes, that may seem extreme, but the rule of thumb is to refinance if you plan to stay in your home for awhile and if the new interest rate is about .75% to 1% lower than your existing rate.
For example, when my wife and I bought our home in 2006 we locked at 6.75%. We refinanced about 1 year later at 5.875%, then again in 2009 at 5.125% with no closing costs. Todays’ rates are hovering around 4.5% on a 30-year fixed, which means we could refinance for the third time!
If you currently have a mortage rate over 5.25%, it may be worth considering refinancing and putting some extra $$ in your pocket, we can all use that in this economy.