Has anyone refinanced lately?

[ruadisneyfan2]

What rate did you get?

I got a letter in the mail from our mortgage bank offering 2.8% for 15 yrs.
We are currently 2 yrs into a 15 yr. at 4.3%.

I'm not sure it's even worth starting over but that's just so low historically. It's tempting.

 

[ConnieB]

Be sure to factor in the costs of refinancing.....they can often take up a lot of the savings! Contact the bank and ask them for a detailed list of the costs.

Also...if you have had a long term relationship with the bank, call and ask them if they'll lower your current rate without a refi. I was able to do that with USAA.....of course that was about 10 years ago, before all the current ick happened when banks wanted to work to keep your business, lol. They agreed to lower the rate, but not the monthly payment. This still resulted in a significant savings for us, especially since we could easily afford our payment and were already paying extra each month......lowering the rate just made the payments go that much further.

 

[JaymeC]

What Connie said, plus you might want to shop around some for lower closing costs or rates. Even if they roll the closing costs into your loan, you're still paying it at some point We re-fied a few months ago, but it was on a 30 year loan and while we dropped a point and a half the only reason it was worthwhile was because I worked at the location and had discounted closing costs, otherwise it would have taken us 5-6 years to break even.

 

[tinker&belle]

We refinanced a little over a year ago to a 15 year at 3.5. We are doing it again to a 13 year at 2.75. Our closing costs are only $310. Basically we will be paying the same amount and taking almost a year off our term.

 

[Angeni11]

We are refinancing through our credit union from a 30 year at 4% (only a year in at a different bank) to a 15 year at 2.26% (It would have been lower but that is the lowest the gov will let someone with an employee discount get). It is bimonthly payments so it will be paid off in 13.5 years although we will put more into it every year to pay it off sooner.

The costs that actually apply to closing are very minimal (rest is the interest and escrow you have to pay up front.

If you plan on staying in your home long term and you hit the break even on the cost to refi in a year or 2 it might be worth it.

 

[ssawka]

Figure out how much you still owe and add in all closing costs, then plug that in along with the new rate and term into an amortization calculator (BankRate.com has a nice one). Take a look at what your total interest cost will be and what your payoff date will be. You can also put any additional payments you plan to add.

 

[DawnM]

We are refinancing.

We are getting a rate of 2.62% and the only closing we have to pay is the $400 appraisal fee.

Of course, we will need to pay our escrow up front, so that will add an additional sum, but then we will get back our excess escrow from our previous loan, so that will be a wash. We plan to write a check for that. And that is not a fee to the bank, that is to our home taxes and insurance.

I ran the numbers and it will save us over $15K in interest over the life of the loan if we pay NO extra mortgage per month. The monthly rate will also go down a little over $200 if we choose not to put that back into the mortgage.

We aren't sure if we will just pay extra mortgage or start a more aggressive college fund at this point. But it won't be just spent on fun.

Dawn

 

[abcboys]

We refinance a few months ago at 3.5% for a 15 year loan with a $299 closing costs. Our loan was from 2003 at 6.375 so we are shaving 6 years off the loan and saving $25,000 in interest payments. Our monthly payments are almost exactly the same. Was worth it for us but there are online calculators where you can punch in the numbers and see if it worth it or not.

 

[Nebraska_Disney]

I did a refi back in August. I paid about $700 out of pocket expenses and had to deal with the escrow etc while waiting for my old escrow to be returned to me. We are in a 15 year note at 2.65%. If you are staying in your home and the closing cost are reasonable, you are going to save a lot of money even if you drop 1% on the rate. Many are going from 30 year to 15 year loans and having their payments stay the same.

Like others said, plug your numbers into a calculator and see what you come up with.

 

[thornton0511]

We refinanced a few months ago too. The new interest rate we were getting was just well worth it. We ended up adding on one more year of payments but our monthly payment went down $225. Plus we were 6 years into a 30 yr note so that extra $$ over the course of 25 years was worth it for us
We did however have to pay a lot in closing cost that are rolled into our new loan and also remember that if you refinance you can only do so for 80% of your home's appraised value

 

[TheRatPack]

We were considering it, taking out a bit of cash with the refi.....it's just so hard to stomach going from 10 years back to 15. FHA says as of April 2013 that all PMI/MPI will be for the life of the loan as well.....so now we're reconsidering the refi before that new rule kicks in, because I think we were maybe just a tad over the amount needed to avoid PMI if we do take that cash out. If we don't take the cash out....we could always sink what we're saving month to month on the mortgage on to those other items we wanted the cash for.

 

[thornton0511]

We were considering it, taking out a bit of cash with the refi.....it's just so hard to stomach going from 10 years back to 15. FHA says as of April 2013 that all PMI/MPI will be for the life of the loan as well.....so now we're reconsidering the refi before that new rule kicks in, because I think we were maybe just a tad over the amount needed to avoid PMI if we do take that cash out. If we don't take the cash out....we could always sink what we're saving month to month on the mortgage on to those other items we wanted the cash for.

We had hoped to take out additional funds with ours to get some remodeling done to our house since usually it comes down to remodeling or Disney every year and Disney seems to always win but after factoring in what we still owed our closing costs ended up eating any extra $$ that the new loan would allow for us to borrow against . But in the end we are saving more a month so it evens out. Also any moneys left in your old escrow will be paid out to you in a check from the bank you were borrowing from since you would have a new one (that's how it was in our case anyway) so that was kind of a bonus for us too!

 

[ruadisneyfan2]

We refinanced a few months ago too. The new interest rate we were getting was just well worth it. We ended up adding on one more year of payments but our monthly payment went down $225. Plus we were 6 years into a 30 yr note so that extra $$ over the course of 25 years was worth it for us
We did however have to pay a lot in closing cost that are rolled into our new loan and also remember that if you refinance you can only do so for 80% of your home's appraised value

Yes, we've been in our home for 16 yrs. We've been done with PMI for about 12 or 13 yrs but we've refinanced twice before over the years.

We had hoped to take out additional funds with ours to get some remodeling done to our house since usually it comes down to remodeling or Disney every year and Disney seems to always win but after factoring in what we still owed our closing costs ended up eating any extra $$ that the new loan would allow for us to borrow against . But in the end we are saving more a month so it evens out. Also any moneys left in your old escrow will be paid out to you in a check from the bank you were borrowing from since you would have a new one (that's how it was in our case anyway) so that was kind of a bonus for us too!

I was considering taking some out to replace our roof. It's not urgent, no leaks, but we were told by a roofer that we only have about 5 yrs left of our current roof and that was around 3 yrs ago.
I'd love to just get that done & over with, I just don't like that we keep restarting & restarting. Our original plan for the next couple of years was to scale back our traveling, & start working on the house more but then we had tons of miles with USAirways & I didn't want them to expire so the Med cruise will be our last big trip.
When we 1st moved in, ds16 was a newborn & we worked frantically on the house, every penny, til we've pretty much replaced everything but the roof. They we traveled a lot, thinking kids are growing up so fast & this house will be here long after we're gone. Now things we remodeled from back then are getting old too. It's a never ending money pit.

 

[Shelly F - Ohio]

You are CRAZY not to do it! Think you are saving 50% on interest. Why let someone else fill their pockets with all that money you could be saving. We just refied 2 weeks ago from 4.5% to 2.75% and we will be saving $257 a month in interest. That is is $3000 a year back in our pocket. At the end of the year we plan to put that money down on the principle on the loan and we will pay the loan off in 8 years!


DO IT.....

 

[DisneyBill]

I'm not sure it's even worth starting over but that's just so low historically. It's tempting.

What do you mean when you say "starting over"?

 

[ruadisneyfan2]

What do you mean when you say "starting over"?

When we first bought, we had a 30 yr. at around 7.5%. Then we refinanced to 15 yr.@ 5 or 6-something. Big improvement. Lower rate & shorter term.
Then we needed to borrow some equity so we refi'd 2 yrs ago and got 4.3 but we only had 7 or 8 yrs left and this took us back to 15 yrs again.

So if we took out roof $ & refi again, it would start the clock over again. Another 15 yrs. No chance parole with good behavior.

I don't want to be old & gray & still paying off our house our whole lifetime. I know the key is to stop putting our hand in the cookie jar just because it's there.

 

[DisneyBill]

When we first bought, we had a 30 yr. at around 7.5%. Then we refinanced to 15 yr.@ 5 or 6-something. Big improvement. Lower rate & shorter term.
Then we needed to borrow some equity so we refi'd 2 yrs ago and got 4.3 but we only had 7 or 8 yrs left and this took us back to 15 yrs again.

So if we took out roof $ & refi again, it would start the clock over again. Another 15 yrs. No chance parole with good behavior.

I don't want to be old & gray & still paying off our house our whole lifetime. I know the key is to stop putting our hand in the cookie jar just because it's there.

Just because your loan is structured as a 15 year product, does not mean you have to take/make payments to pay it in 15 years. You can calculate the, in your case, 13 year payoff necessary payment and pay that rather than the 180 month payments. With such a fabulous APR, I would encourage you to price the loan based on a 10 year payment and go for that if budget friendly. I totally agree with you about getting the mortgage gone way before gray hair sets in. Even though I was gray at 35 and didn't get rid of mortgages for 4 more years.

 

[ruadisneyfan2]

Just because your loan is structured as a 15 year product, does not mean you have to take/make payments to pay it in 15 years. You can calculate the, in your case, 13 year payoff necessary payment and pay that rather than the 180 month payments. With such a fabulous APR, I would encourage you to price the loan based on a 10 year payment and go for that if budget friendly. I totally agree with you about getting the mortgage gone way before gray hair sets in. Even though I was gray at 35 and didn't get rid of mortgages for 4 more years.

Yes, we always say we'll pay extra but then we don't. It takes a lot of discipline.

 

[Shelly F - Ohio]

A good way to be displined to do it is to set up a savings acct. and have so much money direct deposited. Then once or twice a year take that money out and put it on the loan. If you don't ever have that money in your hands its easier to sock it away to make a principle payment. Just keep focused on the big picture...the huge amount of interest you will be saving.

This time last year the remaining amount of our loan had us paying $70k in interest. Now that we have refinanced and commit to putting the extra $3000 down each year our life of the interest on our loan will be $15k.. YES $15K that is a huge difference and I keep thinking of that big picture. I am putting $55k back in my pocket. That it and of itself is disipline enough to keep on this track.

YOU CAN DO IT!

 

[ruadisneyfan2]

A good way to be displined to do it is to set up a savings acct. and have so much money direct deposited. Then once or twice a year take that money out and put it on the loan. If you don't ever have that money in your hands its easier to sock it away to make a principle payment. Just keep focused on the big picture...the huge amount of interest you will be saving.

This time last year the remaining amount of our loan had us paying $70k in interest. Now that we have refinanced and commit to putting the extra $3000 down each year our life of the interest on our loan will be $15k.. YES $15K that is a huge difference and I keep thinking of that big picture. I am putting $55k back in my pocket. That it and of itself is disipline enough to keep on this track.

YOU CAN DO IT!

Yes you're right when looking at the numbers. I can easily save, but then I love to travel. I give up a TON of things for that. My job is super stressful and traveling keeps me sane.
I've read about paying 1/2 the monthly mortgage payment biweekly then on those months when there's 3 pay days, still pay the same but it's all principal. I have a hard time with that too. I admit, I'm weak.