Comments on: Should You Refinance Your Mortgage?

By: Paul in Silver Spring, MD

Paul in Silver Spring, MD — Thu, 01 Jan 1970 00:00:00 +0000

Thanks…that’s kinda what I thought now. And I’m going to make even larger payments over the next 12 months to knock it down even more.

By: PT

PT — Thu, 01 Jan 1970 00:00:00 +0000

@Paul – My opinion is that you have a good loan now. And since you are retiring next year, I would wait till then to make any decisions on moving to a 15. By then you’ll have a better idea of your ability to afford the higher monthly payment.

By: Paul in Silver Spring, MD

Paul in Silver Spring, MD — Thu, 01 Jan 1970 00:00:00 +0000

I owe $125,000 on a 30-yr. loan at 5.75%. My monthly payment is $904, but I add $100 to principal each month. I’m trying to determine whether I should just stick to that (at 8yrs of the 30 years) or refi for 15 yrs. I plan to retire next year, but my income will be about 90% of what it is currently. Looking at different calculators I get slightly different results, and just am not sure which is the best route to save money and also pay off the loan.

By: Financial Samurai

Financial Samurai — Thu, 01 Jan 1970 00:00:00 +0000

Good luck on your refinancing quest PT! What duration and rates are you looking at/finding now?

By: PT

PT — Thu, 01 Jan 1970 00:00:00 +0000

@CharlieM – My hopes are that we see a bounce, especially for our friends on the coasts. I think it will depend on location. Cities like Detroit are going to struggle for a while.

A while back I saw a prediction that real estate values won’t move up until late 2010. But I think that may be too soon to expect anything. The jobs just haven’t come back. When jobs return to normal levels, then wait six months. People will start buying again.

By: CharlieM

CharlieM — Thu, 01 Jan 1970 00:00:00 +0000

What do you for see as far as real estate values for 2010?

By: PT

PT — Thu, 01 Jan 1970 00:00:00 +0000

@KC – Well, I hope it comes down a bit more for you, and real estate values go up!

By: KC

KC — Thu, 01 Jan 1970 00:00:00 +0000

I considered it under the government’s program to refinance underwater loans (b/c out in here in CA practically everyone is underwater) but the interest rate on it isn’t low enough yet. My current interest is 6.5 and they are offering 5.75 right now, not enough to make it worth it yet. But my lender just said the program was extended another year so maybe the rates will continue to come down, though I don’t hold my breath. I can’t believe .75% doesn’t make a big enough difference but he’s telling us it’d be less than $100/month in savings so it’d take a while to make it worth the closing costs and appraisal. We shall see…

Tell Mrs. PT I said hi!

By: Evan

Evan — Thu, 01 Jan 1970 00:00:00 +0000

Pt,

I am literally dealing with the exact same situation on a smaller scale for my Car. I have 2 options:

http://www.myjourneytomillions.com/articles/experiences-auto-refinancing/

Let me know what you think!

By: PT

PT — Thu, 01 Jan 1970 00:00:00 +0000

@Dan – Solid advice. I didn’t know that.
@Evan – 18 months is my break even point for closing costs. However, they are giving me the option of bumping up the interest rate and providing a rebate for the closing costs. No current cash outlay, and still a decent rate (5.5%). So, whether I stay 2 months or 20 years, I’m still saving money. The way I see it, the choice is now between the no cash outlay 5.5 and the 5.25 rate with 2500 in closing. I’m leaning towards the former.