MADISON, Wis. (10/21/11)--A Credit Union National Association (CUNA) economist Thursday told Kiplinger.com he has rule to help those who are deciding whether to refinance their mortgage to take advantage of near-record-low rates. To figure how many months it will take to recover closing costs, consumers should divide the costs by their monthly savings, Kiplinger said. “My personal rule of thumb is that if the reduction in payments would cover all of the costs in less than two years, the decision to refi is a no-brainer,” Bill Hampel, CUNA chief economist, told Kiplinger. “If it will take two to three years, it’s probably a good deal. If it’s much more than three or you don’t expect to own the home or the mortgage for at least five years, don’t bother.” To mitigate the impact of rate increases, negotiate caps with lenders, Jack Pritchard, chief operating officer of mtgprofessor.com, told the publication. Hampel told Kiplinger he particularly likes the 5/5 adjustable rate mortgage, a product that many credit unions offer. The rate adjusts every five years--typically with a two-percentage-point cap on the first adjustment. So during a 10-year period, the rate would average 4.5%--assuming the rate begins at 3.5% and moves up to the maximum 5.5% on the five-year anniversary, he said. To read the article, use the link.