– Charge and you will costs: Refinancing often includes costs and can cost you, including origination costs and you can assessment charges. Such will set you back adds up quickly and might negate any potential cost savings off a reduced interest rate.

– Stretched cost months: Refinancing can increase this new fees ages of the debt, which can signify you end up investing even more from inside the attention along the lifetime of the loan.

– Likelihood of default: For many who re-finance the debt which have a variable interest rate, the monthly installments may improve in the event the interest levels increase. This can succeed hard to maintain costs and you may help the threat of defaulting on the financing.

It’s important to carefully consider the pros and cons of refinancing before making a ple, if you have high-interest personal credit card debt, refinancing to a lower interest rate may be a good choice. [Read more…]