What Does It Cost to Refinance Your Home?
Costs to refinance your home can run from $0 upfront, to several thousand dollars, depending on how the loan is structured. Usually it's between 2% and 5% of the amount of the loan. Getting your home mortgage refinanced is, sadly, no less complicated than getting the original mortgage.
There may be fees for applying, loan origination, document processing, underwriting, recording, tax transfer…. There are costs for an appraisal, a credit report, title research and insurance. And different lenders use different terms for the fees associated with processing a refinance of your home.
People refinance for many different reasons, such as moving from an Adjustable Rate Mortgage to a Fixed Rate or dropping to a lower interest rate. Often the savings make it worth the initial cost and hassle, but not always. And if you restart a 30-year clock on your loan, you can really lose ground. So, it's important to think it through, do the math, and get expert help on whether the benefits of a refinance outweigh the costs.
Credit Union of Texas is ready to help
Some people refinance their homes for reasons that are difficult to avoid—like changing ownership to one homeowner and buying out another. For other refinance scenarios—like switching from an Adjustable Rate Mortgage to a Fixed Rate to avoid rising interest rates, a refinance can provide a huge savings, especially if you're planning to be in your home a long time. Work with a lender you trust to figure out whether it's the right move for you. We'd love to help!