Still Not Sure If You Should Refinance? Read This Before You Decide.

✅ You might be wondering:

• Interest rates don’t seem low enough—is it still worth refinancing?

• I locked in at 6.5%, and now it’s 6.25%—is refinancing even worth it?

• I’ve already had my loan for 3 years—wouldn’t refinancing cost a lot in fees?

• I heard refinancing hurts your credit score—is that true?

📌 Here’s the story of my client, Mr. Wang:

Wang owns an investment property in Brooklyn, New York. Two years ago, he got a loan with a 9.25% interest rate. Recently, after seeing rates fluctuate, he came to us and asked, “Should I refinance?”

We did a detailed cash flow analysis for him and found that even though market rates aren't super low right now, his original loan structure wasn’t ideal (like a very short term and high monthly payments). By switching to a DSCR loan, we helped him lower his monthly payment by over $600, giving him more breathing room in his cash flow. The new loan term also better fits his investment plan.

Even better—he was able to cash out part of his equity to use as a down payment for a second property.

💡 So, who should consider refinancing right now?

• Homeowners with high rates or ARM (Adjustable Rate Mortgages)

• Investors feeling monthly payment pressure and want to free up cash flow

• Those looking to cash out equity to invest in another property

• Borrowers who’ve improved their credit and can now qualify for better rates

• Anyone wanting to switch from a short-term loan to a longer one to ease monthly payments

  
  

🔍 Before deciding, make sure to crunch these numbers:

• What’s the total closing cost? (We usually help you estimate this upfront)

• Will the interest savings cover those costs?

• How will your monthly cash flow change?

• What are your plans in the next 2 years—buying, selling, or holding?

✍️ How do we evaluate whether refinancing is worth it?

We usually look at it from two main perspectives:

✅ Method 1: Breakeven Point Calculation

👉 Best for: Primary residences or long-term rental holds

Breakeven Month = Closing Costs ÷ Monthly Savings

For example:

• Your refinance closing cost = $6,000

• Monthly mortgage savings = $300

So: Breakeven Point = $6,000 ÷ $300 = 20 months

If you plan to hold the property more than 20 months, refinancing is likely worth it.

✅ Method 2: Cash Flow-Based Investment Refinance

👉 Best for: Investors who want to cash out and reinvest

This method is ideal for investment property refinancing. We look at:

• How much net cash flow increases each month

• Whether you can cash out any equity

• If the return on reinvested equity is higher than your new loan rate

Example:

• You cash out $50,000 at a refinance rate of 7%

• You invest that into a new property generating a 10% annual return

Now that refinance isn’t a cost—it’s a smart way to leverage equity to build wealth.

✍️ In short:

Refinancing isn’t right for everyone,but for the right person, it’s a powerful way to adjust strategy, improve cash flow, and even speed up your path to financial freedom.

Still unsure? Stop by our office for a free refinance evaluation—we can walk you through the numbers in just 15–30 minutes.

📞 Book a time: 516-820-3456