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When is it time to refinance your home mortgage?

Timing is key...

This is something we always ask ourselves. You can't crunch a calculator all the time. It is really good to have this worked out ahead of time. Just say, it would be worth time to take advantage of a 1.5% drop in rate. Currently, that would save me over $350 a month. That a nice car payment.

I came across a few good offline articles on Refi-ing. Here are the general rules of thumb I have found based on the scenario that fits you:

If your loan is over $250,000 and you have more than 20 years left on it:

You can usually make good on a rate that 0.75% lower than your current terms.

If your loan is under $250,000 and you have more than 20 years left on it:

If your loan is under $200,000 and you have more than 15 years left on it:

You can usually make good on a rate that 1.5% lower than your current terms. These are just indicators of what you should be looking for, if you see dips in the interest rates. If you have a $300,000 loan and you have 25 years left, 3/4 of a point of interest may be worth your time.

Before you ever think of Refi-ing, always do the math. Also never forget about closing costs. Never ask a mortgage lender if it is a good time to refinance your mortgage, for them it is always a good time to finance.