Question by LiveLife: Closing Costs – What charges can be deducted from closing costs when refinancing a home mortgage?
Best answer:
Answer by pearlmel
detucted for closing costs? well lender fees can be negoated at times. but many people fall into a trap they will tell a borker i dont want to pay closing costs and end up with a higher rate. so while they where busy trying to save 2-3 thousand dollars they pay an extra 30k or more in added interest on the loan! if you are refinancing look to get the lowest rate period! everyone that tries to get the lowest closing costs pays dearly for it over 30 years!
look in general refinancing should cost the average borrower 3% max the average is 4.5% processing fees and underwritting fees are on all loans in one way or anouther!
find the best rate! this will save you the most money overall.
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Pretty much nothing.
The only thing deductible would be the “points” (if any) and, as it is on a refinance and not a purchase, you must spread those points out over the life of loan.
Not sure what you mean. Do you mean, what costs are deductible on your income tax at the end of the year? Sad answer is, practically nothing. If something is clearly identified as ‘points’, then you can deduct a pro-rated amount over the life of the mortgage – for example, 1/30 of them each year for a 30-year mortgage. Interest is always deductible; that will show up on a 1098 mailed to you by the mortgage holder. But all that other stuff, the application fees, title fees, escrow costs, etc is not deductible.
Not much. Points on a refi are spread across the life of the loan, and deducted across those years. There’s probably not much else on a refi that can be deducted.