Record low rates have led to a lot of talk about refinancing from homeowners and loan companies.
Have you been considering a refinance loan? With interest rates so low over the past few years, the question hasn't been "should you refinance?" but "when"?
While conventional wisdom once said you had to shave at least 2% off your loan in order for refinancing to make sense, these days it could be worthwhile with an interest reduction of just 0.75%, says Doug Perry of Countrywide's consumer-markets division. That's because soaring home values, increased competition and automated underwriting (which can approve or reject your refi application in a matter of minutes) have made home refinancing quicker, easier and potentially cheaper than ever before.
Unfortunately, none of this means that your role in the process - namely, making sure that you get the best loan possible - has gotten much easier. To find the best deal, you still need to do your homework, and you need to be smart about the financing options that a lender or broker might pitch you. Otherwise, your refinance loan just might cost you significantly more than it should.
Read the original Smart Money Article.