Anyone else getting these mailers out from Chase (or other banking entity) to refinance? Anyone have any opinions on the topic? I already have a pretty low interest rate, but this could help me somewhat, especially if I move to a 15 yr loan...
WRT moving to a 15 year load, you could keep your 30 year loan and make 15 year loan payments. This gives you flexibility where you can fall back to the 30 year loan payment. This is what I am doing.
I had a 6.75% 30yr loan and last summer refinanced to a 15yr at 4.75. I was making and extra $100 a month in order to pay it off in 22yrs instead of 30 (essentially an extra payment a year) - Now I'm paying about $37 LESS than I was with the extra $100 a month. I'll pay it off a few years earlier than my original plan, and its costing me less to do so each month. do the math and see how much you'll save/pay each month due to the difference in interest Rate before you decide. even if you refinance with Chase, they'll most likely sell the loan to someone else fairly quickly. good luck.
Fees/titling was estimated at ~2500 bucks, 400 of which I pay up front. Is that reasonable or typical? Basically, I think I'll probably save myself about 1% on the APR. Maybe a bit more if I go to a 15 yr loan. Savings are estimated at about 75/month if I stick with the 30yr plan, meaning I pay off the cost of the deal in ~3 yrs. Plus, if I do this through a chase checking account and let them auto-debit, they'll kick back 1% of principal and interest each year. Decisions, decisions...
Although you might be getting a small relief in APR and monthly payments...they usually get you with the damn closing costs when you refinance. So make sure that the amount you plan to save via APR and monthly is significant when considering how much closing costs will end up being.
Problem with getting 30 year loan is aren't you making interest payments the first few years? I understand the having something to fall back on especially in these times, but I say (assuming you are married and no kids) go for it afterall you do have the support of your wife. Now if you have other payments like a car note, dont do it. I just think it is a huge waste of money getting a 30 yr loan. When you are certain you can pay it off in 15 yrs.
I am saying getting a 30 year loan and pay it off in 15 years. Best of both worlds. BTW if it is not clear, the difference between the 30 year monthly note and the 15 year monthly payment goes directly to paying down your equity. For example, your 30 year loan might have a $2,000 month payment. If you had gotten a 15 year loan, the payment would have been $2,500. Every month you send in $2,500 for the 30 year loan. $2,000 is the normal payment and mostly just interest in the initial years. The extra $500 pays down the equity. If you can keep this up for 15 years, you will pay off the the 30 year loan in half the time.
I'm not sure 1% is worth refinancing if you can pay extra each month on the payment. If it was 1.5% or more, or if you had an ARM than it would definitely be worth it.
