To figure this out you need to know your current rate and the rate at which you would refinance. There is a “two point” guideline that has been the main school of thought for a long time. It assumes that mortgage refinancing becomes worthwhile if your mortgage refinance rate is at least 2 percentage points below your current rate. However, today HUD/FHA sees a net tangible benefit if your PITI (principal, interest, taxes, and insurance) declines by at least 5 percent or if you go from an adjustable mortgage to a fixed rate mortgage.
• Will you realize the savings before you purchase another home?
Key Financial Mortgage Co. (NMLS #1800)*
107 South Hurstbourne Parkway*
Louisville, KY 40222*