Mortgage - when new refinancing

On Thursday, according to the weekly Freddie Mac survey, the average rate on a 30-year loan was 3.84%, down from 3.88% the previous week and 4.71% in the same period a year ago. The rate of the loan of 15 years on average to 3.07%, off the coast of 3.12% the previous week and 3.89% last year. A spokesman for Freddie Mac, says rates are the lowest in the history of 41 years of the weekly survey.

Many homeowners opted to refinance last fall and winter, when mortgage rates dipped below 4 percent first, said Guy Cecala, Chief Executive of inside Mortgage Finance, a trade publication. "The people who jumped to 5% also fried on 4%," said.

Mr. Cecala said many borrowers refinancing these days is at least second-timers - there, for its part, made the fall last to reduce his right mortgage three quarters of a percentage point - but he said that he knew of no data tracking this trend.

If you are considering refinancing, financial planners suggest that you address first of all your financial goals - specifically, how long you expect to live in your House.

Some owners decide that it is more logical to stay with their current mortgage, especially if economies are small or they plan to go in a year or two. "There is a problem of refinancing - all this paperwork," said Sheila Walker Hartwell, a financial planner in Manhattan. One of his clients, she noted, has recently decided against refinancing because she was already building equity in his home, that she hoped to use on his next purchase of House.

"When refinance you, you build not fairness," said Ms. Walker Hartwell. "You start at the beginning" of the depreciation tables.

Amortization schedule works like this: in the early years, almost all of the payment goes to interest, so you have most of the loan, is placed to the main.

"It's very important," said Edward Ades, a partner in universal mortgage in Brooklyn. For example, he noted that the first year of a mortgage for 30 years of $300 000 to 4%, a borrower would have paid off the coast of 1.76% of the balance; in the fifth year, which stands at 2.06%.

Those who refinanced in the last year or two have to consider amortization tables, but they do not need to know their position fairness - and when the refinancing will begin to repay.

To calculate that, starting with a reduction of all closing costs, then divide the cost of closing by the amount that you want to save money on each monthly payment. Therefore, if the total cost of closing of $5,000 and your monthly savings of $400, you will be 12.5 months of profitability on the refinancing.

If it say, three years to recover the costs incurred and that you want to move in two years, and then refinancing does not sense, said John j. Vento, a financial planner in Staten Island.

Depending on your lender, you will probably need to have 20% equity and maybe a little more, if you want to pack your closing costs into the new mortgage. Those who are under water - a shortcut to pay more that the House is worth - may take into consideration the home affordable refinance or harp, which is now widely available, noted Mr. Cecala.

Greg McBride, a senior financial analyst for Bankrate.com, suggests owners begin with their current lender and asking if they can simplify the process. You may be able to avoid a second evaluation and reporting of title insurance and expenses, he said, adding, "That would save not only the time, but also money."

It also suggests that the borrowers discover of new donors and consider a short term of the loan, "shaving years off the payments" and build faster actions.

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