Refinancing your mortgage costs money. This is the headline. Someone wrote an article explaining that a financial transaction involves fees.
The summary promises to help you "make sure it's a good deal for you." What a service. Without this guidance, you might have accidentally paid $3,000 in closing costs to save $40 per month. You might have done the math wrong because you learned division from a YouTube video while your portfolio tanked 60%.
Here's what refinancing costs: application fees, origination fees, appraisal fees, title search fees, credit report fees, attorney fees, recording fees, and a fee for the guy who charges you fees. It's like a wedding except you're marrying your own house at a worse interest rate because you thought rates would keep dropping forever.
The article lists lenders that offer "affordable options." Affordable refinancing. That's the pitch. It's like advertising affordable chemotherapy or affordable divorce attorneys. The whole point is you're already f*cked, now you're just negotiating how hard.
Break-even calculators exist. You divide closing costs by monthly savings. If the number is bigger than how long you plan to live in the house, don't refinance. This is third-grade arithmetic. But retail traders can't do third-grade arithmetic because they're too busy calculating what their Dogecoin will be worth when it hits $100.
Some lenders waive certain fees if you agree to a higher rate. Others offer no-closing-cost refinances where they just roll the fees into your loan balance. You're not saving money. You're just moving it around like a drunk guy shuffling cash between pockets to pretend he has more.
The real affordable option is not refinancing at all, but that doesn't generate clickable listicles about lenders.
Photo by Jakub Ε»erdzicki on Unsplash
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