If you could knock off $200 off your monthly mortgage payment on a fixed 30 year loan,would it be something that you'd consider? We've been paying off on the current house for 10 years and by refinancing we'd be starting over again. Would it be a good idea? Thanks in advance!
It depends................ You have to decide if the closing cost justify the reduction in payment (how long will it take you to break even). How long are you planning on being in the house, etc. You need to find a trustworthy mortgage person and go over the numbers with a fine tooth comb.
I'm going to chime in here!! First, I'm a retired banker and often advise people in financial planning. Not knowing your age it is hard to say. But, to just knock off $200 a month and start all over again gives me reason to doubt this would be good. I know your husband was out of work for quite some time but has a job now. Are you in good standing with your current mortgage? Are you having difficulty making payments? How is your credit? If you can satisfactually answer these questions I would say NO!! My husband and I are retired and really have to watch our money. We do not have huge incomes but we are debt free. There will come a time in your lives that you will need to be mortgage free. So, my advice is to struggle while you are young!! We did and it was so worth it. JMHO Pat
Would it be a good move IF she did the 30 yr refinance (if its a lower rate than her current loan) and w/ the lower payment continued to make the same payment - so the $200 would go toward the principal?
The street to poor credit decisions was paved with good intentions!!! You have to consider all the facts, like closing cost. How old are you & hubby Annette? You can pm me if you prefer. Be mindful of your situation now but also down the road. I've seen so many people refinance only to be helped short term. If you were to get a lower rate you really need a 2% or more spread. Then if you really apply the $200 a month toward principal, then it might be worth while. Assuming you have a 30 yr mortgage now that you've paid on 10 years I still cannot say to refi now. I'm from the old school and still believe that your goal should be NO DEBT!! Hope this helps. Pat
I would consider refinancing it for 15 years. The payment will probably still be about what you pay now and you will be knocking 5 years off the loan.
Thanks for all the great suggestions so far! I got a summer cold at the moment and took some night time cold meds and they are starting to kick in,so off to bed I go... Please keep your advice and suggestions coming,thanks!!
you can finance for 20 years and be able to pay it off at the same time you have now. of course your payment will still be smaller than it is now if you get a lower rate
Unless you HAVE to have the cut, it probably isn't the best idea. We re-financed our 30 year for 15 years and our payments only increased around $70 a month...
The best financial advice we've been given; Have your home paid off at the earliest that is possible or at the very least before retirement. Considering that it is for most households the biggest monthly payment going out. With that said. Everyone that we know, be it a relative, a family friend or neighbor that has done this seems to be living a more relaxed life style and/or living their retirement years the way they had dreamed, less stress, traveling etc. and most will tell you that if they hadn't buckled down and made that one payment a priority, they wouldn't have been able to retire when they did. Look down the road and ask yourself where you want to be financially in 15 years or so and you'll have your answer. A quick fix is not always the best fix. Good luck.
