Refinancing can involve several expenses, and these costs should be included when deciding whether a new mortgage makes financial sense. Depending on the loan and lender, expenses may include lender fees, application or underwriting charges, appraisal costs, title services, recording fees, credit-related charges, and other closing expenses. You may also have prepaid items such as property taxes or homeowners insurance. Some lenders advertise options with little or no upfront closing costs, but that does not necessarily mean the costs disappear; they may be reflected through a higher interest rate or added to the loan balance. Your existing mortgage may also have specific terms that should be reviewed before refinancing. Our guide to refinance closing costs explains the major expenses to consider. Comparing these costs against expected savings can give you a clearer picture of the potential benefit.
