My thoughts on refinance rates

Mortgages with shorter terms generally have lower interest rates, and the borrower will pay the loan off sooner because more of the monthly payment goes toward paying down principal. The good news is that this decreases your total interest costs. The downside is a higher monthly payment. On the flip side, longer mortgage terms reduce the monthly payment but increase total interest costs by virtue of the greater number of payments needed to pay off the loan. Each option has its pros and cons.

08/05/09 3

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