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From: keith@whuxl.UUCP (TITUS)
Newsgroups: net.taxes
Subject: Re: Re: Home refinancing
Message-ID: <1042@whuxl.UUCP>
Date: Thu, 13-Mar-86 18:57:09 EST
Article-I.D.: whuxl.1042
Posted: Thu Mar 13 18:57:09 1986
Date-Received: Sat, 15-Mar-86 02:12:23 EST
References: <102@lambda.UUCP> <248@kodak.UUCP>
Organization: AT&T Bell Laboratories, Whippany
Lines: 37

> > Does anyone out there know anything about refinancing a mortgage?
> > Could someone summarized the 3% rule argument (refinance if the interest
> > rate is three percent lower than your current rate)?
> > 
> > would not have to paid with refinancing (e.g., homeowners prepayment
> > and 3 months of property taxes)?
> > Also,
> > can the refinancing points be written off the first year (i.e.,
> > not IRS objection if audited)?
> > 
> > Thanks
> > Sandy
> income taxes. The reasoning given was you were not buying anything, just
> refinancing. Still I thought points were interest whenever you paid them
> and interest is deductable. Can anyone clarify the points issue?
> 
> Brian Suhina
POINTs are simply interest that the lending institution are requiring 
payment for up front before giving you the loan.  They are deductible
whether you are financing or refinancing.  The 3% rule of thumb is not far 
off.  Of course if your house is currently at 17% and you are coming down
to 14%, that 3% is a lot larger than if your`re at 14% now and your coming  
down to 11%.  

Your closing costs are still going to be the same in most areas as if it
were a regular 1st mortg. closing.  You still need a lawyer, title, points, 
etc...

I assume you are talking about a single family dwelling that you are living
in.  

Keith Titus
AT&T Bell Labs
WHippany nj


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