Start with a specific goal
Possible goals include lowering the payment, changing the term, moving from an adjustable to fixed rate, or removing an eligible mortgage-insurance obligation.
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RATE-AND-TERM REFINANCE
Restructure a mortgage around a new rate or term.
A rate-and-term refinance replaces the existing mortgage with a new loan, generally without taking substantial equity out as cash.
Measure the break-even point
Closing costs and any points should be compared with estimated monthly savings. The break-even period helps show how long it could take to recover upfront costs.
Review total cost
A lower payment can result from extending the term, which may increase total interest. Compare the new loan over the time you realistically expect to keep it.
Refinancing may increase the total finance charges paid over the life of the loan. Estimates are educational and actual terms depend on a complete application and approval. This is not a commitment to lend.