In all my years as an advisor, I never imagined mortgage interest rates would be as low as they are now.

When you consider not that long ago, the banking industry faced a massive number of foreclosures, the fact you can borrow money in 2021 for under 3% is mind-boggling.

So, if you have a mortgage, the question worth asking is: Should you refinance.

A general rule of thumb is if you can save 1% in interest, you should consider it.

But keep in mind: refinancing is rarely free. There are always some costs associated with it that are added back into your mortgage balance. The person who originates the loan must be paid somehow.

So be sure you know how long it will take to recoup those costs through lower interest.

Also, less interest means fewer deductions come tax time. You may save on interest but may save even more in income tax.

Refinancing often means restarting the payout process. If you have ten years left on a 30-year note, a new 30-year mortgage will push back your payoff date another 20 years unless you pay much more than the minimum payment.

One of the best refinancing strategies is to keep paying your new mortgage at the amount you paid your old mortgage. You’ll be debt-free sooner.

If you’d like to talk more about how this works, feel free to reach out by calling 513-563-PLAN (7526) or clicking here to schedule a time.

Regards,
Nikki Earley, CFP®