As spring continues to blossom in the North of Boston area, you’ve probably noticed a few signs that the North of Boston Real Estate market is picking up.  From “for sale” signs in the front yard to those you know who are looking to buy a home this spring, these are all positive indicators of a healthy real estate market.  As a North of Boston Real Estate agent, this vibrant activity is exciting and I thrive on helping buyers search for a great North of Boston home and assist sellers with getting their home sold.

But what if you aren’t interested in buying or selling?  Maybe you’ve been considering refinancing your home to cash in on the low interest rates or in hopes of selling your home down the road.  Refinancing your home is still something you want to carefully consider and isn’t for everyone.  Take a look at the six tips below to help you determine if refinancing is right for you.

1. Credit score and income- Most banks in today’s market will require you to have a minimum credit score of 620 in order to refinance.  You will also need to prove that your household finances have been stable.  If unemployment or other issues have come up that have decreased your finances significantly; you’ll find it hard to refinance.

2. Costs- Refinancing your home will cost you typically 2% of the new loan amount.  This includes application, appraisal and inspection fees. Included within refinancing costs is the new escrow account you’ll need to fund. The lender will set up this account for home-insurance and property-tax payments from which they’ll draw annually.  Want to avoid this fee?  Use the same lender you used for your initial mortgage.  Their only costs are limited to issuing new paperwork, so they’re able to keep costs low and can oftentimes speed up the process. Another option is a good faith estimate. Your North of Boston Real Estate agent can help you determine which option would work best for your home.

3. Interest rates- Refinancing right now is great for homeowners whose current rates are above 5.5% and are hoping to save on their monthly mortgage costs.  For homes in the North of Boston area, you could potentially save a percentage point or more on an outstanding mortgage.

4. Adjustable-rate mortgages- Determining whether you’d like to go with an adjustable-rate mortgage or a fixed-rate mortgage can be tricky.  An ARM can be a good choice for today’s market as you’ll cash in on the current lower rates, but can be unstable in the long run.  However, a fixed-rate mortgage ensures that your rates will remain stable and won’t rise if the market changes.

5. ‘Underwater’ homeowners- Today’s housing market has left around 11 million homeowners “underwater” meaning they owe more on their home than it’s actually worth.  They will have a hard time refinancing and can only do so through a federal program. Your North of Boston Real Estate agent will help explain the option of a “short refinance” that was launched last year by the FHA.

6. Greater pricing disparity- Based on your current credit score, the rates offered for refinancing can vary greatly. Illinois lenders will look at the state’s average loan-to-value ratio and the percentage of homes with negative equity.  The higher the percentage of these homes, the higher the rate a borrower will most likely be offered.

Refinancing your North of Boston home can be a savvy financial decision if you’re in the right spot for it.  If you have any questions regarding refinancing your home, please feel free to contact me!  Or, if this spring season has you on the hunt for a home in the North of Boston area or you are hoping to sell your North of Boston home this spring- I’d love to help!  Contact me anytime to get started!

Sven Andersen
North of Boston Real Estate Expert

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Searching for a new place in Winchester to call home? The Sven Andersen Team makes it easy for you to search for your new Winchester home. This FREE, NO-OBLIGATION service can help you find the home of your dreams! Simply visit http://www.northofbostonlistings.com/ and fill out the form to start your auto-email home search today! It's just that easy! The Sven Andersen Team is always willing to help and will always respect your privacy; we leave it up to you to contact US when you're ready to buy or sell in the Winchester area.

If you want to learn more about selling your home visit: www.PriceMyNorthofBostonhome.com
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If you, friends, relatives, or colleagues are considering buying or selling a home, condo, or land, please consider contacting Sven for assistance in your search. Sven coverage area includes: Winchester, Belmont, Medford, Woburn, Lexington, Arlington, Melrose, Stoneham, and Reading.  We also offer a complimentary referral service, called "Anywhere Agents," to assist folks who are looking to buy or sell outside our coverage area, including international locations. We will interview prospective agents in the area(s) you or a family member are considering to assure you get the most knowledgeable Real Estate Professional to assist in your home buying/selling needs.