With interest rates still near historic lows, many homeowners and home buyers are taking advantage of big, long-term savings. It's a real dilemma if you're trying to decide whether to sell your home or refinance. There are pros and cons to each but what's the best one for your particular situation? How do you know which is not only the better choice, but the right choice? Well, there are certain factors to consider and help you make a sound decision.
Should I Refinance or Sell My Home?
Two of the biggest objections homeowners have about selling is moving and going through the process of selling and buying simultaneously. Some homeowners actually talk themselves into refinancing and staying put because it's a lot more straightforward process than applying for a mortgage. However, something to keep in mind is the truth about this very common misconception: refinancing isn’t “renewing” or “reworking” your current mortgage, it’s an entirely new home loan.
Owning a home is a major financial commitment. Besides the cost of home maintenance and upkeep, there are the monthly mortgage payments. If you're a new home buyer, you have the cost of shopping for a house and making a down payment. To help ease expenses or improve living conditions, refinancing an existing mortgage or selling and moving to a new house can be good options in certain situations. --San Francisco Gate
There's no real difference between refinancing and applying for a new home loan; the process is very similar. Even with this knowledge, it still can be difficult to decide whether to refinance and stay or to sell your current house and buy a new home. Fortunately, it's not as tricky a scenario as it first seems. If you're wondering if you should refinance or sell, here are some helpful guidelines to make an informed decision:
- The break-even period doesn't fit. If you are leaning toward refinancing, think seriously about the break-even period. This represents the amount of time or number of months it will take to recoup your closing costs. A good rule of thumb is if you're not going to stay in your current home for four to five years or more, it's better to sell and make the move now.
- Future remodeling will be necessary. Another factor to consider is the condition of your current property. If remodeling work is necessary for improved function and style, the extra cost may or may not be justifiable. You should take the opportunity to look for a new home with what you most want and need.
- Space is at a premium and shrinking. A big sign it's time to sell is if your current property is too small to accommodate your family. This is particularly more important if you have plans to grow your family. While a room addition might be a solution, you won't recoup your cost to build it and it might even price the house out of the neighborhood.
- The neighborhood is no longer a good fit. One solid bit of advice real estate professionals give home buyers is to buy into a neighborhood, not just a house. It's because neighborhoods do change. It's also a reason to sell if your current neighborhood just isn't a good fit any longer; for whatever reason.
When you’re ready to sell your home, whether you’re near West Columbine Drive, around West Andora Street, over by West Pershing Avenue, or elsewhere in Sarah Ann Ranch or Surprise, Arizona, call us to learn about your home’s true market value and what needs to be done to get it sold quickly and for top dollar.