• Call Krista: Should I Refinance?

    With new historical lows in interest rates, I am getting lots of calls about refinancing.  My lending background gives me the capacity of giving advice and suggestions.

    Every time I get asked this question my first response back is how long have you owned the home and how much do you have left to pay? I recently had one person who has a 7% interest rate that made sense for them to continue with their current mortgage rather than do a refinance! 

    If you are wondering, let’s chat I will be happy to do the math and figures so you can have a balanced opinion with no charge!

    Along with this question is the next question, should I refinance and pull money out to pay off loans, credit cards, student loans and cars?

    Home lenders are strongly encouraging consumers to use their house as a “BANK”. I want to caution you and encourage us to have a discussion about what your short and long term goals are! Remember there are no “Free Lunches”! 

    Doing a refinance and using your equity to pay off one time debt such as school loans or even to advance fund some major home repairs may make sense, however, if you use the money to pay off or down a car or credit card, often that debt is replaced and then you have double the debt. 

    Banks make money off of interest and they make money off refinances due to fees they charge. They are not doing this out of the kindness of their hearts! 

    Having a home completely paid off without a mortgage puts you in a better emotional and financial position, so let’s talk about all your options!