A look inside how refinancing your home works

A look inside how refinancing your home works

RICHMOND, Va. (WWBT) - In early June, the Federal Reserve left interest rates alone making it more affordable than ever to borrow money. With rates hovering around 3.5 percent, many homeowners are in a position to refinance and lower their monthly costs.

My producer recently refinanced her home. She expects to live there a few more years, but not many, so she jumped at the chance to save some money on her monthly payment.

She opted to use CAP Center to refinance her mortgage, that way, there were no upfront costs…those are built into the loan plus her appraisal was waived.

She filed her application online. After gathering and submitting the necessary paperwork, she was offered a new quote.

Her current rate is 4.625 percent. Her new rate is 3.625%...an entire point lower.

Based on what she owes on the home, her monthly payment will drop about $160.

If you refinance and have to pay those fees upfront, do the math and make sure it’s worth it. Many lenders charge 3% to 6% of the principal to process the loan and that can take years to recoup those costs.

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