Given the market, should you stay in your home and refinance or just sell it?
Should you stay in your current house and refinance or should you prepare to sell it because the market is so attractive for sellers right now?
There are a couple of questions you’ll need to ask yourself before you can make this decision:
- How long will I stay in the area?
- What does it cost to refinance?
Once you have the answers to those questions, choosing which path is right for you should be a little easier.
Now let’s talk about the refinancing process. A good rule of thumb is that if you can get a good interest rate that’s 1% lower than your current interest rate, it might make sense to refinance. Typically, there are fees associated with refinancing. To find out what those fees are, just ask your mortgage company for a good faith estimate. That will have a list of all the fees associated with refinancing.
Suppose that it’s going to cost $2,000 to refinance your house. In this scenario, you’ll get a 1% reduction in your interest rate, so you’d save $100 a month on your mortgage if you do refinance. In this case, it would take you 20 months to pay off the $2,000 investment. Ask yourself if it makes sense to even invest your money right now if it’ll take that long to recoup. It might make more sense to use that money to fix your house up so that when you get ready to sell in two or three years, you’ll get top dollar for it. It just depends on your situation.
If you’re still not sure about which path is right for you, don’t hesitate to reach out to me. I’d be happy to share my advice about what exactly you can do to your house to get the biggest bang for your buck. I can also give you guidance about whether it makes sense to refinance your house instead. It’s my pleasure to help you.