The Best Refinance Option

Dave tells Tara what things to look for when refinancing.

QUESTION: Tara on Twitter says she has been given three options for refinancing. She wants to know which option is best. Dave reviews a few things to look for when refinancing.

Dave's ANSWER: I don't know what the three options are, so I have no way of knowing how to measure it exactly. Look at the interest rate and closing costs out of pocket, then look at the term. I recommend fixed rate only with a term of 15 years or less. Pay the minimal amount of closing costs that you can. These days, paying one point may make sense because you'll probably get a payback on that, which is reasonable.