How long after buying a home can you refinance?

Shanelle Missy · Joined: 29 Sep 2009 Posts: 11

I just bought home in July 2008 for 87k. Our interest rate is at 6.25. With the mortgage rates falling because of the economy, we would like to refinance to pay off some bills and to get a lower rate. We are first time home buyers and have a fixed 30 year FHA loan. Do we have to wait one whole year to finance or can we do it now?

DanAronG · Joined: 17 Oct 2008 Posts: 103

Here in the UK there is no minimum time to have owned a property before you can remortgage. That said, many lenders have their own in house rule of either 6 or 12 months.

In general the main issue you will face is the early repayment charge to get out of your current deal, as this fee will usually eat up any savings made by switching to a better deal.

Elmira Nancy · Joined: 13 Nov 2009 Posts: 28

Smart move. It depends on the fine print of your current loan. Does it have prepayment penalties or any other ugly clauses? I suggest you simply call your current lender and tell them you are thinking of doing and see what they say. They may even give you a break on document fees and closing costs to stay with them, although it may not matter with FHA.
I just built a new home, closed in Sept for 6.34% and refinanced with a different lender for 4.75% in April. Tip - you can fold the closing costs and doic fees into the new loan if you don't want to lay out the cash. Your monthly payment will still be much lower.

askmr · Joined: 11 Dec 2009 Posts: 3

You can re-finance for as long as you want to, if you want to just lower your monthly payments.

humphreyhale · Joined: 20 May 2010 Posts: 1

If you are buying a home or you are refinancing an existing loan, mortgage calculator can help you make the correct decisions.