Mortgage Loan Refinancing - yes or No?

Any time that you can save money short term or long term, refinancing for mortgage loan should be given some consideration. The other consideration is changing the term of the loan. If you are 5 years into a 30 year loan, then refinancing into another 30 year loan starts the clock again. This is a primary consideration for the borrower. If you qualify for refinancing of your home or property through the normal underwriting guidelines, then a mortgage broker will save you money while paying your closing costs.

Closing Costs must be considered because a typical loan refinance will require the closing costs are added to the financing costs. Closing costs include legal, lending and filing fees as well as title insurance, which is required on all loans. Prepaid interest for the following month and prepaid insurance and taxes need to be considered as well.

Usually, mortgage brokers will show the value of No point and No Closing Cost loans. The cost of the closing will be assumed by the broker in yield-spread premium paid from the lender bank. This means that the rate will be higher than if closing costs were paid by the borrower, but the only out-of-pocket expense for the borrower is the prepaid insurance, interest and taxes- which are a per-diem and the borrower will not have to ever pay twice for one day by law.

If you are saving any money and not increasing the terms of a loan, and the closing costs get paid for, why would you not refinance?