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Do you ever wonder if you have the smartest mortgage for your situation?  With mortgage rates currently at their lowest levels since 1955, many Americans are asking themselves if they should refinance.  Most homeowners admit to having doubts about their mortgage when the statement arrives.  Unfortunately, most people simply pay the bill without exploring how easy it could be to have a smarter mortgage and a lower payment.

Remember, your home mortgage could be one of the largest financial investments you’ll ever make.  It needs to be managed with care.  Managing your mortgage can often mean keeping your eye on interest rates and other factors that can affect your payment amount.

There are a few good reasons to consider refinancing:

• If you have an ARM – Make sure you know when your rate is scheduled to adjust.  If your ARM is not set to adjust for several years, it may be a good idea to refinance and lock in today’s low rate with a conventional, long-term mortgage.
• If you have a fixed-rate mortgage – Examine how your current interest rate compares to current interest rates.  The Census Bureau just released figures showing that 24.1 million American’s have mortgages with interest rates over 6%.  If you’re one of these Americans, you could benefit from a refinance.
• Analyze your goals – Perhaps they have changed since you bought the home you’re in and you need a more flexible mortgage.  You might like to explore the possibility of taking cash out of your equity to make home improvements.  Maybe you have high-interest debts you’d like to clear up?  With credit card interest rates at a 9-year high and mortgage rates at 50-year lows – it could be a great time for you to refinance to consolidate debt.

To find out when you will see real savings from a mortgage refinance, first add up the costs involved.  This includes discount points, processing fees, appraisal fees and title insurance.  If your closing costs for a $200,000 mortgage are around $2,500 – and your Home Loan Expert can help you save $300 per month by locking in a lower interest rate – then your break-even point will come in just over 8 months.  If you plan to be in the home for several more years, while continuing to save thant $300 every month, then this is a financial move that makes a lot of sense!

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