When going through a California refinance, it is a big question to answer, of when to lock in the interest rate.  Especially with California interest rates, it is hard to tell what the interest rates will do.  In general, however, with the ever increasing market in California, interest rates tend to increase more rapidly than they come down.  When someone chooses to buy a home or refinance their California mortgage, they should lock in their rate when they see the California interest rate on the downtrend.  After all, it is always possible to refinance again if the interest rates drop again.  

            But keep in mind, if there is a drop in the interest rates, it might not be enough of a drop that will lower the monthly payments of a California refinance mortgage loan.  The most it could do is lower the interest rates slightly, but keep the monthly payments the same.  Of course, every situation is different, so it's important to consider all of the options.  

Some people consider paying off some of the points in their California mortgage in order to lower their interest rates.  Paying points may or may not be the best option, however, depending on what they are doing. The mortgage points paid on a home loan that has been refinanced can be deducted from the annual taxes only in small increments, for example, 1/30th a year for a 30-year mortgage. This means it could be several years before that lower rate makes up for the points the person pays off. However, if someone is buying a home, points paid are a tax-deductible expense for that year.

 When looking to refinance, someone might be lucky enough to find a California refinance with no closing costs. There are few loans that truly have no closing costs. Sometimes lenders may not charge application fees and agree to pay the appraisal and title fees.  This comes with a warning, however.  When some lenders reduce the closing costs and other fees, they tend to increase the interest rate in return. Lenders can also roll the costs into the amount of their loan.  So, this makes the California home loan appealing at first, but in the long run, it will not be so fun.  Because the person is not paying costs up front, it's called a "no closing cost" loan.  

            People typically wonder how much money to bring to the closing of a refinance.  In general, they will want to bring as ever much possible.  But as far as what they need, it could vary.  A general guideline is that the person will need two percent of the home's purchase price for prepaid interest to cover the time between the date they close the home loan and the date they make the first mortgage payment. Some states may also require pre-payment of property taxes. When refinancing however, the old mortgage will most likely have money in an escrow account that can cover these costs. Some borrowers get short-term loans while their escrow transfers back to them, but most pay the money at the closing knowing they'll get it back when their escrow is returned.