Planning to Refinance looking for suggestions

[Mahi Mir]

I currently closed my first rental property this month at 5.875% 30 yr fixed conventional rate with a payment of $1100 per month. Rental is $1450 per month so the net positive cashflow around $225 per month after all expenses. Question is it suggested to REFI to a rate of 4.875% now again with a closing cost of $2000  which might increase the cashflow for $325 per month . I plan to hold the property for another 5 yrs hopefully . Thanks for any insights and suggestions.

[Andrew Postell]

@Mahi Mir if you just closed you should NOT refinance again.  Whomever is quoting those closing costs to you is not being upfront about the fees associated with the loan.  I can't tell your loan amount....but based on math, maybe around $165,000?.....but you will pay for title insurance again, doc fees, etc.  I feel that $2,000 is what they are charging you to buy down the rate?  Not 100% sure but however they are presenting this information it is not accurate.  There's no way to just get to a lower rate when refinancing by paying $2,000 on a loan amount of $165,000 when you just closed.  Please be very, very cautious here.  If you still want to continue to explore their offer then ask to get the loan "in writing"....and see what happens then.  Would love to get a report back from you after you get it in writing to see how the numbers look.  I would guess that it's not $2,000 or they won't even provide them in writing.  And when I say "in writing" I don't mean sending you a summary that someone typed up in an email.  You should ask for a "loan estimate" or a "Fee Worksheet".  Those are the formal documents that hold lenders accountable to what they quote you.  Tag me with any questions.  Here to help.