[quote=harvey][quote=no_such_reality]Long thread, skipped most of it.
This is simple, if you’re currently around $400k on balance and at 4%, you can get a better rate, lower payment AND let the lenders pay for it. Aka free. Sure, you could do better, but you have to pay for that.
Don’t let great be the enemy of good.[/quote]
That makes sense if you ignore the fact that any loan is about paying for money.[/quote]
Your existing loan is about paying for money.
If your existing loan is at or above 4% and the balance is more than $400K, it’s costing you more money.
It’s simple, regardless of term, a remaining $400K balance at 4% is going to cost you about $1333, this month.
Refi to 3.75% with the same balance and that $400K costs you $1250.
Next month, it’s abut $1330 for your existing loan costing you, and the new one about $1248.
So, in the near term, it’s $80/month less. Just shy of a $1000 this year. And about the same next year. And then we’ll average $950 for the next three years.
It’s a simple question.
Choose one for your remaining $400K balance:
A) do nothing, continue to pay $1330/month in interest.
B) refi, pay nothing up front and still only owe $400K, pay $1250/month in interest.
C) refi, pay about $4000 up front to get a better rate and pay probably $1200/month in interest, maybe $1166.
