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July 14th, 2010 at 04:06 am

Refinance.....Again? - We bought our house in 2007, $160K purchase price (Appraised at $160K), put $10K down (Original loan was $151K), 5.75% 30 year fixed loan. We refinanced in 2009, $140K was the balance on the loan and the house was appraised at $164K, 4.80%, 20 year loan. We paid the closing costs for the refinance out of our savings account. Now it has only been a year since we refinanced and interest has gone down a lot again and we are thinking of refinancing again. Looking at my banks website it looks like we could get a 15 year loan at 3.75%, so we would be going down another full point in interest which is huge. Our loan balance is currently at $131,850.00. We could easily afford the slightly higher payment since we are already paying extra every month and with the drop in interest the actual amount of the payment would not change very much. The only part I am struggling with is the $4K - $5K we would have to pay in fees. We only have about $7K in savings right now, so we would not want to take that money out of savings. We would need to add the closing costs to the loan or possible borrow the money from my Mom, I know she would be cool with giving us a 0% loan for a year or 2 if that is what we really wanted to do. Hmmmm....any thoughts or suggestions????

5 Responses to “Refinance.......Again???”

  1. whitestripe Says:

    have you worked out how much you'd be paying at the end, for each refinance you have done?

  2. creditcardfree Says:

    Do all the math...to make sure that it is the most financially beneficial. You could just pay extra on the mortgage to shorten the length and interest.

  3. ndchic Says:

    I think that you should shop your mortgage refinance. We are currently refinancing about $104,000 and our closing costs are around $2500. Are you just going to Gate City Bank for the refinance? We went with them when we bought the house but their closing costs are much higher than some others. I'm in Fargo but if you want, I can give you the name of the mortgage company and person that I'm working with.

  4. MonkeyMama Says:

    3.75%???? Holy cow!

    I would probably do it. We have refied many times (down from 8% to under 5%). There were many more years in between to recoup our costs, so it is not quite the same. But, I think it is safe to say that this would be your last refi, ever, and the rate is unbelievable. You would be shaving 4(?) years off without changing your payment "by much." Seems like a no brainer.

    I would just borrow the closing costs with the refi. Only because it seems pretty certain this will be your last refi. It would add about $15/month to your payment. Compare that to what your current payment would have to be (extra principal) to pay it off in 15 years. I am presuming that the refi would be a much lower payment for a 15-year payoff. (If it is $100/month less, that is a substantial savings, in my opinion). I am also presuming you will be in this home a long time.

  5. Banker Gurl Says:

    Thanks for the suggestions. PLease see my next post to see the numbers. I am looking around right now to see what kind of rates/fees I can find!

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