Why should I refinance?

Good for you. Too many people just look a the $116 a month in savings and Whoo hoo! THis is what you need to look at: If you have paid 7 years (84 mo) on your current loan, you have 276 pmts left. @ $1433 each, you'll pay $395,508 to pay off the loan after 23 years. The new loan, although only $1317 per month, will have 360 payments or a total of $474,120. So unless you really need the $116 a month to survive, refinancing as proposed is probably not smart. That said, you didn't include info as to what your current and proposed rates are. One thought might be to check into a 10, 15, or 20 year term loan. I'm doing a lot of loans for people like you that have paid down 5-7 years and can refi into a new 15 year loan and the pmt that is about the same. Call me at 888-889-9950 and I will be happy to go over some figures to help you make a good decision. I am not licensed in AR, so I won't be trying to convince you to do a loan that doesn't make sense.

You are absolutely right when you consider a long term perspective and not just immediate savings. Sounds like you have 23 years left to pay. So look at 20 or 15 years fixed programs. Both 20 and 15 years usually offer more competitive rate than 30y. By getting lower rate for 20 years you will save on your monthly payment. By getting shorter term not only you will not waste 7 years but you will pay off your loan 3 years earlier and will save thousands of dollars in future. 15 years fixed will give you even better savings in future, but your monthly payment will be higher and you have to be confident that you can comfortably afford new monthly paymentWhat you need is refinance options analysis to look at numbers and determine what makes most sense to you. Regarding closing costs - there is always a way to cover them by taking slightly higher rate or by increasing your balance and this is also a part of refi analysis. Please let me know if you have questions, Thanks D

Depending on what your interest rates are currently and what was offered to you, it may or may not make sense. We really need more details to answer your question. But just guessing, it looks like you are paying to much closing cost for the rate reduction you are getting. I would shop around a bit more. If you choose to refinance into a new 30 year mortgage you could apply your monthly saving into your new payment and reduce your term by roughly 4-6 years and still realize a savings. A professional lender should be able to produce a spread sheet or cost analysis for you showing multiple loan options and savings potential. If you need one, contact me and I would be happy to help you.

Refinancing is not always in one's best interest... try looking into a 15 or 20 year mortgage rather than a new 30 year... Also, depending on how long you anticipate staying in your current home, you also might want to consider an Adjustable Rate Mortgage (ARM).. if you plain on staying in your home for the next 5 years, then do a 5 year arm, but continue to make the same payment your used to now, you can reduce your principal in huge chunks, and would be in a much better position in 5 years when you go to sell it.. WilliamAcres.com