How Many Times Can I Refinance My Home?
How Many Times Can I Refinance My Home? Refinancing your home several times could be an ideal option to saving money. The answer to the question is that there technically is no limit to the amount of times you can refinance your home, but it’s important to know when it’s best to refinance and potential precautions. To get a better understanding, check out our tips below:
- Prepayment penalties – This is something homeowners want to look out for when refinancing quickly. Your existing mortgage could have a prepayment penalty, this could be especially true if you took it out less than one year ago. Prepayment penalties can be costly, typically equal to six month’s interest charges on your current mortgage.
- Interest Rate – Looking at your interest rate, it’s typically advised to only refinance if you can save a full percentage point off your current interest rate.
- Time – How long do you plan to live in the home. If you’re unsure if you’re planning to stay in your home for an extended period of time, refinancing might not be your best option to save money.
In general, it’s key to make sure you’re coming out ahead of where you’d be if you stayed with your any previous mortgages. If, after accounting for costs, interest and previous refinances, it’s clear you would be creating a deeper into a hole, you probably shouldn’t refinance.
Do you have any tips to offer on refinancing? Comment to share with us!