I saw a piece on the news over the weekend that was talking about how crazy low interest rates are right now. They were interviewing a mortgage broker who said that it is definitely worth a conversation with your current mortgage lender & also worth shopping around a bit to other lenders to see if refinancing makes sense for you.
I was curious, but also apprehensive as my husband and I only bought our first home two years ago, so this whole mortgage thing is new to me, and "refinancing" just sounds, well... frankly, a little scary. That said, I'm always looking for a deal, so on Monday I went into our current mortgage broker's office and told them I wanted to just see what refinancing options I might have. Turns out that we are able to refinance from a 30-year to a 15-year mortgage right now for about only $95 more per month on our payment. We'll incur some costs to refinance (title, new appraisal on our home), but it looks like those costs will be able to be rolled into our mortgage, meaning nothing extra is out of pocket for us right now. Our mortgage lender is walking us through the process, and while it is a little scary, she's been helpful to explain how things work, making them seem less daunting. While we're not totally sure where an extra $95/month is going to come from in our budget right now, we are CONFIDENT that in 15 years when our house is paid off and our kids are headed to college, we will be so glad we refinanced now & found that extra $95/month!
A few things to note: when we went into talk with our mortgage broker, I was "equipped" with knowledge of what other banks/lenders in town were offering for their rates because I'd looked at the Sunday paper. Turns out that a couple of local credit unions and banks were more competitive than my current lender, and this caused my current lender to get creative to offer us a better deal. It is worth shopping around or picking up Sunday's paper to see what rates are right now. From the Sunday paper, I'd seen that I can get a 15 year fixed rate for 3.25% and a 30 year fixed rate for 4.125%. Our current rate is 5.375%, so either way we're ahead (general rule of thumb is that if you can lower your interest rate by 1% it is worth looking into). When you talk to your lender it is worth looking at both refinancing from a 30 to a 30 year mortgage and the option of going to a 30 to a 15. There are pros & cons to both that they'll walk you through.
All this said, the most important thing to know is that rates are down, and it is worth a phone call or a meeting to see if you can get a better deal than you have right now.... do it today, and you'll probably be glad you did!
good info. you are so good at reading up on things. fyi, when we refinanced our mortgage through our credit union, we did not have to pay closing costs that you might have to pay elsewhere.
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