I am receiving offer by mail to refinance with the new lower rates, is it wise to refinance, and what are the risk?

Asked by Shan, Los Angeles, CA Thu Aug 16, 2012

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Keith & Kins…, Agent, Verona, WI
Thu Aug 16, 2012
Take a look at what a refinance would cost you. Divide the total refinance cost by the amount of savings every month to determine how many months it will take to recoup your costs. This will help you determine if it's worthwhile.

Also, i'd recommend going to a local lender that you trust rather than some random lender doing a marketing campaign by mail.
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Cindy Davis, Agent, San Diego, CA
Thu Aug 16, 2012
I agree that whether to refinance or not is a matter of numbers. How much does it cost to do the refinance versus how much you will save.

I also get all those refinance offers but am very skeptical. Personally. I don't trust any of those letters - they are just pounding the pavement to get business. Just because you get a letter doesn't mean you qualify for a refinance.

If you do decide to refinance, I encourage you to work with a local mortgage broker in your community who has a good reputation. Ask your friends, colleagues, neighbors and any local Realtors you know for a good recommendation. Consult with 2-3 mortgage brokers to compare programs and costs.

There is still a lot of dishonesty in the mortgage industry so I am encouraging you to use somebody with a local reputation.

All the best!
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Michael Magaw, Agent, Torrance, CA
Thu Aug 16, 2012
I agree with Lance. You need to look at all variables. The new rate may look great, but how much are they charging you? These fees and points will probably be rolled into the new loan, but they are still fees that you will have to pay.
Use a reputable lender that you can trust. I would be happy to connect you with lenders that I know and trust. Contact me if you want a referral.
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Lance King, Agent, San Francisco, CA
Thu Aug 16, 2012

The decision to refinance or not depends on the numbers. How long are you going to stay at your current place? What is your current rate? How much will it cost you to refinance? What are the savings?

Talk with a reputable mortgage person locally and they should be able to help you figure out if it makes sense for you or not
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