No Points/ No Closing Cost Refinance Program
On qualifying loan amounts of $250,000 and up, Mortgage Financial, Inc. has a No-Cost Refinance Program that truly has NO COSTS, which means no points, no hidden fees, and no surprises. We don't increase your loan amount to cover the closing costs. It's simple: we pay all the closing costs out of our commission. That's it. Yes, you pay a slightly higher interest rate, usually 1/8th-1/4% higher, but you save all of the closing costs....no appraisal fees, no attorney's fees, no fees period! But does a higher rate really make sense? Most often, yes! Consider this:
On a $250,000 loan the closing costs to refinance would be approximately $2,000. If you paid this $2,000, the after-tax savings is only about $28 per month! So, it takes 71 months, or almost 6 years to break even. But what if you invested the $2,000 you did not pay in closing costs? $2,000 invested at 5% would make you $6 per month, after taxes. Once you take this into account, the actual break-even is nearly 8 years, while the average mortgage loan in the U.S. lasts, according to Fannie Mae, only 4.2 years. Also, if rates drop after you close, you can simply refinance again with no closing costs. Compare this to paying (or rolling into your loan) $2000 every time rates drop!
Click here for a recent joint Freddie Mac/Penn State University study outlining the benefits of not paying points (or closing costs).
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