A Complete Guide to Refinancing Your Home Mortgage

If you’re paying an interest rate of more than 5 percent, now may be the time to refinance your home mortgage.

Although interest rates have risen slightly in the past few weeks, they are still at historic lows. The average rate for a 30-year, fixed-rate mortgage was 3.87 percent in the last week, and the average rate for a 15-year mortgage was 3.11 percent, according to the Freddie Mac weekly mortgage rate survey.

Deciding to refinance comes down to whether it will actually save you money, says Casey Fleming, author of “The Loan Guide: How to Get the Best Possible Mortgage” and a mortgage professional in the San Francisco Bay Area. “Everybody wants a rule of thumb, and rules of thumb don’t work.”

He suggests calculating whether the new loan will save you money based on the time left to pay off your old loan. The question you should ask yourself is: If you have 20 years left to pay on your mortgage and you get a new 30-year loan, would your payments be lower if you paid the new loan off in 20 years?

“The biggest mistake people make is they keep regenerating their loan so it’s never paid off,” Fleming says. More here.

Home Mortgage Refinance Application and pen and calculator.

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