Refinancing your home

[Csara]

Is refinancing your home in 2003 a good idea to save money?

[jessica]

It all depends on what kind of a loan you want v. what you currently have. There are some really low adjustable rate mortgages out there ... but when the fixed term is up, your rate can go up usually as much as 5% more!

We looked into refinancing our home, but we want a fixed rate (not an ARM) and it would only save us about $40 a month ... not worth the closing costs all over again to us.

If your goal is just to have a lower payment than I'm sure you can do that. On my loan, if we went with an ARM ... we could save as much as $4,000 in monthly payments this year alone. :eek: We just want to stay with a fixed loan.

[Deana]

Originally posted by jessica
not worth the closing costs all over again to us.

That's exactly why we didn't refinance. We have a pretty good rate, but there are even better rates now. We just didn't want to roll the closing costs into our mortgage.
One thing we did learn, is that if we pay on our mortgage twice a month instead of just once our house will be paid off sooner. We are going to start paying 1/2 our mortgage every two weeks (direct billed, so no need to send in the payments twice). Our broker told us that our house will be paid off about 8 years earlier. Now, I am NOT a finance person, but somehow it affects the principle differently if you pay it twice in the month. Talk to your lender if you are interested on more details (since I don't have any more :p )

[jessica]

Good point!! We're trying to pay an extra payment every year (good to do after tax returns, bonuses, etc) and that's supposed to cut about 8-9 years off our term.

[Csara]

We are doing the same thing Jessica...trying to pay an extra payment each year. We looked into re-financing but it didn't turn out to be a good idea for us b/c we'd have to lay out a large chunk and who knows how long we will be in our current home. We weren't sure it would be long enough to pay off for us.

[Ellyanne777]

I have been really surprised at all the refi calls we get every day!! I mean our internals are going nuts. I pitched in yesterday to order title work on their refi's and I did 75!!! I was exhausted yesterday...some of these people are barely getting a better rate...not worth the time for me.

[Jester]

Originally posted by Ellyanne777
I have been really surprised at all the refi calls we get every day!! I mean our internals are going nuts. I pitched in yesterday to order title work on their refi's and I did 75!!! I was exhausted yesterday...some of these people are barely getting a better rate...not worth the time for me.

Apparently its not so much the rate or the lower payment, but getting the cash that they need so very badly--unemployment + recession = find cash anywhere.

[Ellyanne777]

:bump:

[Aaronsgirl]

For us refinancing is going to save us BIG time!
We are paying 7% right now and are in the process of getting a 5% (or lower) - on a 20 year fixed.
We are also putting our credit cards on it ($11,000) to get rid of that debt.
We do not have to pay ANYTHING for closing costs and actually will be shaving 10 years off of our loan.
Our mortgage payment will only increase by $100 a month, but will save us paying our credit card bills monthly (+ interest on them) and like I said, shave 10 years off.
We were thinking of getting a 5 year arm for 4.375%, but I think we'll end up going the 20 year route.
So, I guess it depends on what you have and what you can get.

[Deana]

Aaronsgirl, that's great! I brought some credit card debt from my single days into our marriage and dh has considered rolling that debt into a home equity loan (I think that's it anyway). I didn't realize that you could do it if you refinanced too. A friend of mine just refinanced too and they had zero closing costs. I guess banks really want the business.