You’re in a difficult situation at the moment. The current mortgage rates are incredibly tempting, but you don’t plan on selling for at least another few years. It can be tough to get the stars to perfectly align for a home sale—more on that in next month’s blog—but it just might be the right time to refinance.
A typical mortgage rate for well-qualified borrowers is just above 3 percent. The best predictions at the moment project the average mortgage rate to start 2022 at around 3.5 percent. Simply put, as rates creep up, we will not see rates below 3 percent for years. Those figures, coupled with rising property values, could mean you are in for sizable savings.
Everyone’s magic number—the difference between your current mortgage rate and the rate you could reasonably expect to get if you refinance—is different. Depending on the closing costs of the refinancing and your larger goals, a new rate that’s worth it for you might not be worth it for someone else in a similar position. However, if your likely new rate is at least 1 percent lower than your current rate, you should strongly consider refinancing.
Other indicators that now might be the best time to refinance your house include:
- Your credit score improved since you closed on your mortgage
- Your household income has increased since you closed on your mortgage
- You want to get some cash out of your equity
- You want to sell your home in about 10 years or so and need to do some repairs
- You want to shorten the mortgage term, thus saving on interest.
How Can a Florida Real Estate Attorney Help with Refinancing?
First, we need to clear up a common misconception: the attorney hired by your mortgage lender does not, and cannot, represent you and your interests. The lender’s attorney only has one objective: to protect the interests of the lender. Plenty of homeowners mistakenly believe they don’t need to hire an attorney because the lender has one.
Ultimately, a Florida real estate attorney will look out for your interests and ensure that the loan documents reflect your objectives. Additionally, attorneys can look out for predatory lenders who promise favorable rates but surprise borrowers with hidden fees.
The cornerstone of Salas Law Firm is providing professional and effective legal services for Floridians undergoing real estate transactions. We have a deep network of fantastic real estate professionals, and we can even help you locate reputable lenders.
Contact our team today to schedule your initial consultation. We are currently offering discounts on our closing services for nurses, veterans, and first responders.
John Salas
