I would like to refinance my house to put down some additional funds to get a lower payment is that good?

Jacquline
I would ike to know if that is a good thing because i plan on putting down and additional $20K

Rodger
It depends on a whole wide range of variables--your current interest rate, your future interest rate, the value of the home, the various things you might or might not do with the $20, 000, your tax bracket, how much longer you plan on staying in the property, and much more. In some cases, it might make sense; in other cases, it'd be a terrible idea.I'd say talk with a good mortgage broker, but even for good ones, there'd be a temptation to recommend that you refinance. Talk, instead, with a financial planner or an accountant.My instant, gut reaction is to say: No. Don't do it. Reasons: I don't know how "liquid" you are, but you don't want to tie up a lot of liquid cash in an illiquid investment. Especially not in today's uncertain economy. What if you lost your job in a couple of months and needed that $20, 000?If you're planning on staying in the house another 15 years, then your costs would be spread out over that length of time. However, the average persons sells their home after 5-6 years. That means you'd have to recover all your refinancing costs, and more, in a much shorter period of time.If your interest rate is 3%-4% or more above what you could refinance for, it might make sense. But interest rates have been relatively steady the past few years. You can get a mortgage in the range of 5.5%-6% today. So, generally speaking, if you're not refinancing out of a mortgage that's 8% or higher, it may not be worth it.If you've only had your mortgage for a few years, it might make sense (if your rate is high, you don't need the cash, and so on). However, if you've had your mortgage for 7 or 8 years or more, you're finally starting to really pay down your principal. If you refinance, you're back to square one, mostly paying interest.You can see that this can get pretty complicated. You need to consult with someone who can look at all those variable and more, and help you reach the right decision.Hope that helps.

Celeste
You actually don't have to refinance in order to put down more money. Most loans have a reforecast clause in it that you can use to your benefit. If you put down more than 5% towards your loan amount (i.e. 20K extra towards a 400K loan amount) the monthly mortgage payment will automatically recalculate based upon the new loan amounts. SO all you have to do is mail in the extra 20K towards your principle along with your monthly payment. Rates are fairly low right now 6.125% for a 30 year fixed. Only refinance if it will lower your rate.

Maryetta
Before you refinance take a look at the site I listed below. They will aid you in shaving 10-15 years off your mortgage without refinancing and without spending any money.

Daisey
Yes, Very good idea...defenitely its beneficial.