What are the pros and cons of refinancing a loan?
The pros to refinancing are usually going to be getting a lower interest rate and saving money over the life of the loan or pulling out money (if you have the equity available) to buy additional income producing properties or pay off higher interest debt. You might also be able to refi to a lower interest rate and shorten your total term from say 30 years to 15 years and not pay too much extra per month.
Some cons would be additional fees and closing costs as well as the possibility of lengthening the total term of the loan. Say you had 24 years left to go, but you wanted to pull out some money and refi’d to another 30 year loan. You just added another six years of payments to that loan.
Low interest rates are the major reason to refinance.With 30 year fixed rate at all time low you can save money by refinancing and lower your monthly payments
You can also shorten the length of your loan.