easy · Certified Financial Planner Professional Conduct
The Ostrow household is considering a refinance of their 400,000 mortgage. Closing costs are8,000 and the monthly payment would decrease by $250. The Ostrows plan to move in 24 months.
What is the correct recommendation?
- Refinance only if they can roll the closing costs into the loan balance.
- Refinance; the 250 monthly savings is a significant budget improvement.
- Refinance and apply the 250 savings to principal each month.
- Do not refinance; the breakeven period exceeds the expected tenure.
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