1710: [Part 2] Should I Refinance My Mortgage by Scott Rieckens of Playing With Fire on Home Loan Savings
Optimal Finance Daily - Financial Independence and Money Advice
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Re Financing
When you're self employed, lenders typically want to see two years of self employment income before they will consider you for a refinance. To determine the break even point, you divide the cost of refinancing by the amount you save every month. The result is the amount of time it would take you to break even on the deal. So for example, let's say you save 50 dollars per month by refinancing, but the loan comes with five thousand dollars in closing costs. It would take you 100 months, or a little over eight years, to break even if you stay in your house beyond the breakeve point you save on the loan.
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