Some families inadvertently pay thousands and thousands of dollars beyond what they could have if they had taken the proper time to refinance their loan. On the flip side, while refinancing may seem like a sure bet to save money, there are some major considerations to think through as to whether you will be able to break even on the loan. This chapter pulls from pages 67-69 of the Keeping the American Dream, 2nd Edition curriculum developed by NeighborWorks America to outline the thought process that should go into this task.
The goals of this chapter are:
- To illustrate the hidden costs that interest adds to a mortgage payment.
- To explain how refinancing can save homeowners money.
- To explain some of the fees associated with refinancing.
- Over the course of a loan, you will pay much more than you originally borrowed.
- Refinancing a loan can save you a lot of money on interest that you will not have to pay.