should I refinance my home if I know I will be moving in less than two years?

Question

I have a 15 year mortage on my home. I am planning on selling it and moving in about 18 months. What should I do to get ready? What will make it sell faster? I don't want to be showing the house too much before I am ready to move because I am afraid it will upset my kids. Any advice is appreicated.

Answer 1

My friend made a huge mistake by refinancing about a year before he sold his property. His closing costs were about 7,000 and he saved about 150 per month for one year (1,800 per year). He lost approximately $5,800 on the deal. If he planned on staying more than five years he would have made out. I would suggest refinancing if you you can recoup the closing costs before you sell. In two years you will most likely not be able to do it. In todays market you have to flexible and perhaps offer a what others are not like a renovation credit, closing credits etc.
As far as not showing your home too often; you must take into account that the only way sell it is that you have to show it. My best advice is to price reasonably while you enter the market. If it is overpriced the average consumer will not even look at it and also if you start to lower the price after you hit the market most people won't care because their realtors are out showing other houses that are in their budget. Also, take into account that if a consuner is looking for a house in two months and your house is overpriced they will not consider your house and even when you lower it; it maybe too late because they have found another home. My advice is to price it accordingly and if it is a good price you will have an influx of buyers and there might be a bidding war.

Answer 2

Depends on how your refinancing.

If your term is coming up for renewal then by all means why not. Just be sure to not get a closed term longer than 12 months or 18 months. Your best bet if you know you will be moving is to ensure one of two things:
1) Open (no penalty for paying out early)
2) Portability. (I'm moving but plan on buying again, so take your mortgage with you )

The bottom line is you have optioins and banks want your business. Your bank will usually waive any fees if you ask them. They want to keep you so if you refinance now and move buy something else they will work with you so that your happy, and keep your business with them.

Ask your bank, preferrably someone who has been there a few years, there are a lot of newbees in the mortgage dept.

Answer 3

You would only refinance if you need to take out money or if your rate was significantly higher than the 15 year fixed rates today (apx 5.75%).

Here is some additional info. Hope this helps.

Answer 4

It all depends on your needs and/or what kind of loan you have now. Talk your situation through with an experienced Loan Officer so you can come up with some good options.