Refinance Closing Costs VS Breakeven Point

[Pesi S.]

Hello,

If one can refinance and reduce their interest rate on a investment property by 2% points but it takes 2.5 years to just recover  all the fees  is that normal breakeven time and worth doing it. The closing costs come to around 5K on a $105K loan out of which $1K is prepaid & escrow and monthly savings on interest is around $180. No points on loan. With this one needs to hold onto the property for at least 3 plus years to have some benefit as we will be rolling over the closing costs into new loan and you pay interest now on a higher loan balance.

Thank you.