What break-even is good?

If you will keep the loan well past the break-even month, the refinance pays off. Under two years is usually an easy yes; past five years deserves a closer look at your plans.

Should I roll closing costs into the loan?

It keeps cash in your pocket but you pay interest on the costs.

Why does my lifetime cost go up when my payment goes down?

Resetting to a new 30-year term spreads the balance over more years. You pay less each month but for longer.

What makes an IRRRL fail?

Most often the 36-month recoupment test when costs are high relative to savings, or a rate drop under 0.50% on a fixed-to-fixed refinance. Frank can often restructure the costs or wait for a better rate.

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Does refinancing make sense?

A lower rate only helps if you keep the loan long enough to earn back what it costs. For VA streamlines, the law sets a hard limit of 36 months.

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Questions people ask

What break-even is good?: If you will keep the loan well past the break-even month, the refinance pays off. Under two years is usually an easy yes; past five years deserves a closer look at your plans.
Should I roll closing costs into the loan?: It keeps cash in your pocket but you pay interest on the costs.
Why does my lifetime cost go up when my payment goes down?: Resetting to a new 30-year term spreads the balance over more years. You pay less each month but for longer.
What makes an IRRRL fail?: Most often the 36-month recoupment test when costs are high relative to savings, or a rate drop under 0.50% on a fixed-to-fixed refinance. Frank can often restructure the costs or wait for a better rate.

Does refinancing make sense?

Questions people ask

Sources