Should You Refinance in 2021?


Looking at refinancing your home in 2021? This may be the perfect time for you to do so. After the ongoing pandemic affecting the housing market over the last year and a half, the result may be in perfect favor for those wanting to refinance. If you’re interested, please reach out to see if you qualify today. The opportunities are currently great.

Lower interest rates

The point of refinancing a home is to swap out an existing mortgage for one that has a lower interest rate. This is usually a smart thing to do if you think you’ll be staying in your home for a long time, turning the closing costs into savings. Since refinance rates are incredibly low right now in 2021, if you’ve been debating on refinancing your home, now is the time. 

save money

You’re getting a lower interest rate but what does that mean to your mortgage every month? You’re paying less every month due to the lower interest rate. If you’re planning on borrowing $250,000 at 3% for 25 years, thats a monthly payment of $1,186 with a total interest of $105,658. On the other hand, if you’re refinancing to just a fraction of a percent, you’ll be cutting down on monthly payments and overall costs. Let’s use the same numbers –   $250,000 at 2.5% over those 25 years, your monthly cost will be $1,112 and your total interest owed is $86,463.

+ Shorter terms

In addition to lower interest rates resulting in saved money every month and in the long-term, for those who budget well and can reduce their term by a few years, the money saved will drastically change as well. If you can repay the mortgage in 20 years instead of 25, you’re total interest will be $67,942 – that’s $18,521 saved for a monthly payment cost of $1,325. 

Refinancing your home can be a smart thing to do, contact a mortgage lender like Bill Jones to see what options are best for you.

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