topic Re: Refi to 15 yr or just make xtra payments?? in Mortgage Loans

Refi to 15 yr or just make xtra payments??

whodatnation2 — Sun, 12 Apr 2015 15:21:17 GMT

I am currently with BB&T on a 30 year fixed@ 4.125 interest rate. I have had the mortgage for 2 years now. My question is should I go through the hassle of refinancing to a 15 year mortgage or should I just make xtra payments to have it paid off around the 15 year mark? My middle fico is 780 so I would qualify for 15 year interest rate around 3%. However I would hate to pay closing costs on a new loan and all the hassle that goes with it. Do you think the bank would "modify" my interest rate to keep my business? Thanks in advance.

Re: Refi to 15 yr or just make xtra payments??

StartingOver10 — Sun, 12 Apr 2015 15:35:03 GMT

No to the "modify" your loan - refi is how it is done

Depends on the costs to refi - 3% is pretty attractive. OTOH, keeping what you have and paying one extra principal payment per year saves approx 7 years and can be done any time. If you want to save 14 years - make two extra payments and so forth. For more accurate figures use the www.bankrate.com mortgage calculators and work out your best scenario. Of course, if the refi costs are low, that 3% is very attractive.....

Re: Refi to 15 yr or just make xtra payments??

whodatnation2 — Sun, 12 Apr 2015 15:52:07 GMT

How about getting rid of my PMI early then? Is that EVER really possible?

Re: Refi to 15 yr or just make xtra payments??

StartingOver10 — Sun, 12 Apr 2015 16:05:21 GMT

I assume you are in a conventional loan. You can get rid of your PMI early if your LTV is 80% or less than the original purchase price. Some of the MI co's have a min number of years, 5 years IIRC for most. I will check that figure. If your current LTV against a new valuation is 80% or less, than it may be best to refi - because not only are you getting the interest rate of 3% you are dropping the MI. Those two amounts are substantial and go a long way toward bolstering your idea to refi. The best way to do this is to do the actual math - figure out the new payments without MI + cost to close. See what your recovery period is in months and then make your decision.

Re: Refi to 15 yr or just make xtra payments??

compassion101 — Mon, 13 Apr 2015 06:15:53 GMT

What are the closing costs to refinance?

How much more do you need to get rid of the PMI?