I am about to refinance my house, and I have a couple of questions. I can do the same rate I am at 8.25% (I know not very good but its a one income family and I took on alot of her debts when we got married) and pay off everything except the truck and the house. My truck is at 2.9% so I did not want to pay that off I would rather pay off all the high interest credit cards. Closing costs are 2k with no prepayment penalty. I have the option to refinance in a year or I could buy down the points and save my self the refinancing cost in a year. For 2k more I could buy down the rate to 7.5%. Is this worth it? It seems to me that in the long run I can save money buy doing this. I wont have to refinance the house and pay the closing cost again and I would have the benefit of a lower interest rate for that year.

Any thoughts would be greatly appreicated.

Also the lendor I am going through is Full Spectrum Lending out of IL anybody ever heard of them? Good or bad.

Thanks

 

If you absolutly sure you will stay in the house long enough to recoup your initial payment and you can afford it, go for the lower rate.

 

Thanks I figure I would have to stay in the house at least five years to make it worth while, if I lower the mortgage by 1 point.

 

If your going to be in the house for the long haul, that 1pt is H-U-G-E.

For more info, check this out: http://www.interest.com/content/refinance/index.asp

They have some cool calculators & FAQs to figure out what's best for you. Best of luck to you.

 

Thanks Dezervit that link has really helped.

 

FYI:

my buddies parents re-financed their 5 yr old, $300,000 house last year and averaged it out to a savings of over $210,000 over the 30 year finance period.

Makes a difference, dont it

 

Actually, with the banks are competing now, you shouldn't have any closing costs, no matter how bad your credit it. Here are the numbers for your savings. I don't know how long you are refinancing for, but this is based on 30 years.

A $200,000 house.

At 8.25% you would pay, $340,911.00 in interest.

At 7.5 % you would pay $303,434.00 in interest.



I would go with the lower interest rate if you can .

 

JDaddy,

I work for a Mortgage company in Northern Indiana. I am a Systems Engineer and not as "financially minded" as our Loan Officers and Portfolio Management group.

We do loans in Wisconsin. I would recommend discussing all these issues with a good friend of mine that manages our Portfolio Refinance area. You can contact him at 800-757-7334, his name his Mike Morin. Tell him you are a friends of Ray's. Also feel free to check out our web at Trustcorp Mortgage Company

He is VERY low pressure and will be happy to guide you in the right direction, whether we get the business or not. Our rates are typically as good as others on normal programs. And we don't play any of the games with hidden costs etc. that you can run into.

If you are looking for a loan amount that falls into the "Jumbo" category... we may not be as competitive but Mike can still give you all the info you would need to make a good decision.

Let me know if you need any other info,

Raymond