| Author |
Message |
|
|
ben1
 Guest
0.10 Dollars($)
|
Posted: Mon Aug 20, 2007 5:05 am Post subject: Will refinance make sense? |
|
|
Hi, I am thinking of renting a property for just a year and then selling it the next year. so do i refinance now to interest-only loan for getting max cash? will it be a sensible decision? _________________ Need help choosing the right loan? Get free consultation from community lenders/consultant |
|
| |
|
 |
Ryan
 Guest
0.10 Dollars($)
|
Posted: Mon Aug 20, 2007 5:17 am Post subject: |
|
|
| I don't think it will be wise to do so because there are loan costs involved in the refinance. And, you cannot recoup the costs just by refinancing for a year. |
|
| |
|
 |
miller_st

Joined: 17 Jan 2007
Posts: 917
168.82 Dollars($)
|
Posted: Mon Aug 20, 2007 11:43 am Post subject: |
|
|
That could be risky. You need to think what would be your options if you are not able to sell after one year. You can get stuck with an I-O mortgage. Right now property market is going through turmoil and you can't be sure what will it be like next year.
Miller |
|
| |
|
 |
evolovik26
 Community Experts

Joined: 15 Aug 2007
Posts: 482 Location: Minneapolis
19.70 Dollars($)
|
Posted: Mon Aug 20, 2007 12:30 pm Post subject: |
|
|
There is not enough information. Is the new loan going to save you money? What is the cash for? How much cash can you get? Can you get a no closing cost loan? How much is a max cashout? Are you going to borrow 100% of your property worth? Why you need the cashout now? _________________ Eugene Volovik
Branch Manager
Team USA Mortgage
612-481-3127
Conventional, FHA and Commercial Lending |
|
| |
|
 |
Niicss

Joined: 03 Oct 2005
Posts: 1047
156.17 Dollars($)
|
Posted: Mon Aug 20, 2007 5:25 pm Post subject: |
|
|
I also feel that you should explain more about what your plans are. Tell us how long the present mortgage has been for. And why do you want to sell off the property within after a year? _________________ Good is the Enemy of Great. |
|
| |
|
 |
larry

Joined: 27 Jun 2007
Posts: 3328
473.40 Dollars($)
|
Posted: Tue Aug 21, 2007 12:36 am Post subject: |
|
|
Hi Ben,
Nowadays, refinancing with an interest only loan has become a popular thought as the borrower can get maximum cash and can save money as they do not have to pay both the principal and the interest. But the borrower forgets that he has to pay the principal amount in a lump sum at the end of the loan term.
An interest-only loan works well for borrower who expects to be in their home for a period of at least ten years. In that case, the loan payments will be mostly towards the interest for the first few years of the loan.
But if you are thinking of selling the house by next year, then you may not be able to benefit from the interest only loan as you will be living on it for a year. So, it is better if you don't consider an interest only loan.
For further guidance, you can seek the help of any financial advisor |
|
| |
|
 |
helping_user

Joined: 31 Mar 2006
Posts: 786 Location: Hawaii
146.34 Dollars($)
|
Posted: Sun Aug 26, 2007 6:58 am Post subject: RE: 1 year refinance may not make sense |
|
|
Hi Ben,
The current national average for closing costs on a refinance loan is above $3000. That's quite a large sum. So, if you're just refinancing for a year, I shall suggest that you look for some other option to get cash. The best thing will be to calculate and find out if refinance can help you to save. You can use the Mortgage Refinance Calculator for this purpose. Though the calculator isn't meant for an interest-only loan, yet you can use it because in the initial years of repaying a loan, most of the monthly payment goes towards paying the interest. So, it will give you a rough idea as to whether it is worth refinancing.
Thanks. |
|
| |
|
 |
heavenhack7

Joined: 05 Apr 2007
Posts: 73
0.78 Dollars($)
|
Posted: Tue Aug 28, 2007 11:35 am Post subject: |
|
|
hi so you mean to say that you are giving on rent for 1 year and than sell it ................................see i agree with other members explain in detail wat exactly you want us to focus on and what conditions are you in and which country are you in all these things are neccesary for us to kno so that we can assist you better.
i hope you can understand wat i want to convey so plz explain a litlle bit more so that we can assist you better |
|
| |
|
 |