Trillion Mortgage Brokers of Utah Evaluate the Pros and Cons of the New No Cost Refinancing Option

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While refinancing may seem like a perfectly viable option, Trillion is demonstrating that it could cost more money than it saves.

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The introduction of a “no cost refinance” has a large number of homeowners reevaluating their options and taking the idea of refinancing into consideration. Though the interest rate is the major concern, other factors should be taken into consideration, including appraisals and closing costs. Trillion home lenders of Salt Lake City provide consultations to inquiring individuals as to whether or not this option would benefit them in the long term.

The “no cost refinance” doesn’t actually physically match up to its name. Actually, it turned out to be a highly successful marketing scheme. The “no cost” part derives from the fact that there aren’t any out-of-pocket expenses. In fact, the lack of closing costs actually precedes a higher interest rate. Lenders charge a higher interest rate over a long period of time, and use the excess to pay for the closing costs on the refinance. This does open doors for individuals who want a lower payment, but don’t plan on staying in their home for more than another year or two. The higher interest rate doesn’t hit them over time and they save on closing costs.

Trillion also points out the flaw within the rule of thumb that you shouldn’t refinance unless you save up to 1%. The mortgage brokers of Utah debunk this rule with the notion that it all depends on the amount of your loan. All loans have fixed costs, such as credit reporting fees and appraisals. In order to make the closing costs profitable, a smaller loan requires a great reduction on their interest rate. For larger loans, individuals could potentially benefit for a ¼% reduction in their rate.

The planned length of the mortgage may be the deciding factor into whether or not a homeowner should refinance. The longer a mortgage is kept, the greater the potential savings from a refinance. If individuals plan on keeping their home for at least another five years, they don’t need as great of a reduction rate. Every individual and every refinancing option is different; consulting with a professional will help homeowners evaluate their own, specific needs and options.

Trillion home lenders of Salt Lake City are known for their customer honesty and assistance. They provide information on a wide variety of loans as well as offering mortgage calculators and informational guides. For more information about refinancing, or to schedule a consultation, visit their website at

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Mark Schow
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