A Refinance That Doesn't Break-Even - Example
In this example, we look at the financial impact of refinancing into a new mortgage with a 1% lower interest rate and term that is equal to the number of payments remaining on the current mortgage. We assume the current mortgage has been paid for 20 years and has 10 years of payments remaining. The new mortgage is due in 10 years. We have also assumed that the house will be sold in 10 years and that the refinance costs $3,000 plus 1 point. 1 point is equivalent to 1% of the new loan amount. Finally, we've made standard assumptions for the rest of the parameters.
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No Cash-Out Examples: Attractive Refinance Borderline Refinance Unattractive Refinance
