[USER]

I need an advice folks.
I’m trying to figure out if refinancing my mortgage would make send at this time.

I bought a house September 2023 at 575,000 at 6.99%. Loan amount was 517,500. PITI is 4863. My current lender offered to refinance at 6.5%.

New loan amount is 513,144 (which is what I owe with my current mortgage), PITI is 4663 with closing cost of 3,338.

I was told that the loan is free and the closing cost is for the taxes. I will skip 2 payments and will get 13k from escrow balance.

I’m planning to sell the house next year once 2 years is up from the date of purchase to avoid capital gains tax.

Do you think it make sense to refinance at this time?

[Marcie]

When you refinance, don’t they tell you how long you need to keep the property in order for it to financially make sense to refinance?

[Samantha]

Do you have pmi. You might save more by asking to have it removed

[Christina]

Why would your bank refi you to a lower rate for free? Are you sure the closing cost of $3338 is taxes? Otherwise, on the surface, the $200/mth savings will take you 17 months to break even.

[Mark]

6.99 to 6.5 ? No!!! And I am not even “running any numbers”. Your current lender is trying to preempt you refinancing at 5% in 3 or 4 months.

[Rob]

IMO, that’s not enough of a decrease. In the past I didn’t refi unless I was dropping 1%.

[Scott]

I wouldn’t. You’re selling too soon, you won’t have enough time to cover refinancing costs.

As a general rule of thumb it takes about 10 mos to break even on a 2% rate reduction.

[Author]

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