Starting 2016 by Ditching the Serial Refinancing Persona

[Coronita]

Well, that’s it. I’m done.

No more serial refinancing on the primary. Starting with a 30 year mortgage, followed by one 30 year refinance and 3 or 4 15 year refinances later, my final payment was processed and I am done with my primary’s loan….a decade later…

Phew… I’m exhausted… And I’m totally cash poor now. But I feel better now, and I’m glad I was able to time it so I can start 2016 with no reoccurring mortgage payments on the primary.

Over the next year or so, I’m going to be working hard to rebuild and replenish my funds, and it’s going to be a long and painful process.

But I’m looking forward to 2016 with a fresh start….

[moneymaker]

Good Job flu!
After my payment tomorrow I will have a majority equity position in my house (according to Zillow), and I should sign up for earthquake insurance. Probably the state sponsored one I suppose, anybody have suggestions?

Also just thought I’d put this out there, there is a site called nixle that will connect you to emergency alerts via text or voice alerts, just signed up to it.

[flyer]

Congrats, flu.

It is a great feeling–enjoy it–and Happy New Year to all!

[Coronita]

[quote=moneymaker]Good Job flu!
After my payment tomorrow I will have a majority equity position in my house (according to Zillow), and I should sign up for earthquake insurance. Probably the state sponsored one I suppose, anybody have suggestions?

Also just thought I’d put this out there, there is a site called nixle that will connect you to emergency alerts via text or voice alerts, just signed up to it.[/quote]

Exactly why I signed up for earthquake insurance myself.

http://piggington.com/ot_i_just_bought_earthquake_insurance

We’re lucky. In San Diego, earthquake insurance isn’t actually expensive.

Also, just upped my umbrella insurance too.
I also got some flood sensors that I attach to my security system and put a few of those in the laundry, bathroom, and kitchen,

[ltsddd]

[quote=moneymaker]I should sign up for earthquake insurance. Probably the state sponsored one I suppose, anybody have suggestions?
[/quote]

California Earthquake Authority (CEA). You should be able to get that via your home insurance company.

[The-Shoveler]

Congrats flu !!
The strategy I am thinking of is to get to >50% equity in a few years (when we can get a reverse mortgage) .

[Anonymous]

Did all the refinancing really pay off? Typically a refi takes a few years before the interest savings is break-even with the costs. Seems unlikely that one would come out ahead with several refinances if the loan was going to be paid off in only ten years.

[scaredyclassic]

My earthquake insurance quote is quite a bit higher, I think 2k a year?  Which probably means Temecula is much more likely to liquefy in the event of a major seismic event.  Which means maybe I should buy it.  I do own more than half of my house, and I would like to stay, so I probably should get the insurance.  Its just, the deductible is so damn high.  I doubt I’ll sleep any better at night than I am. Ive been sleeping so well since I knocked off drinking again 3 weeks ago.  I don’t get up in the middle of the night to pee.  I just sleep the whole night through.  It’s amazing.

[phaster]

[quote=flu]
But I’m looking forward to 2016 with a fresh start….[/quote]

+1

[Coronita]

[quote=harvey]Did all the refinancing really pay off? Typically a refi takes a few years before the interest savings is break-even with the costs. Seems unlikely that one would come out ahead with several refinances if the loan was going to be paid off in only ten years.[/quote]

Actually, it did. Because each time I did it it was at least .5% difference and each loan I held for at least 2 years and on a 15 year, the principle gets chewed down pretty quickly, especially in some months was was making a double payment for principle only. My first loan was at 30 year @ 5.75%…My last loan was 15year 2.5% ..Lol…. What helped chew down the principle was getting on a 15 year on my second refi, because personally I didn’t like how on the 30 year the first 4-5 years, most of it just goes towards interest payments.

Also, I guess plans change. I was planning to just drag this out, but the Broadcom’s acquisition kinda of threw a positive bone on the equity side, and meanwhile switching to smaller and riskier company made me sort of want to finish this off in case things don’t work out and I join a startup or something else that doesn’t pay as well as before or maybe I’ll just start to take things easier and work less.

Also, I’m looking at the stock market, and I didn’t really do that well this year. I was negative this year on the active managed portion of my portfolio, because idiot me was thinking “oh with a 2.5% 15 year mortgage, I can easily beat that by putting my money into high dividend, high quality stocks like Chevron, Exxon Mobil, and other assorted energy stock..and it’s definitely a lot safer to do that then leaving my money in Broadcom common stock”. Oops… Yeah, that worked out really well for me.

Fortunately, I came out slightly ahead after the stock appreciation from Broadcom’s acquisition and it more or less compensated for the losses I ended up taking in oil/gas/energy. Selling some some index funds earlier for long term cap gains also helped. But yeah, when my energy/gas/oil took nose dive, it got me thinking….Paying of my mortgage is like paying myself 2.5% return, which is still better than the -15 to -20% my oil/gas/energy dividend investment was going to pay me if that’s all I did.

Oh well, chalk this up as lesson learned. Don’t get too greedy and think you can outsmart the markets all the time. Sometimes boring is good.

[matt]

Congrats flu… I see paying off your primary as a true life achievement… And one that should be celebrated. I was stuck with a 4.75 30 year from 2010 (wasn’t able to refi due to working overseas). I paid it off in 2013 and sleep better at night knowing I own my home and worst case have to come up w property taxes and basic bills to provide my family with shelter in a beautiful part of the world..

It’s been a big sacrifice working in the Middle East but achieving this goal made it all worthwhile. I just wish the market wasn’t so inflated so I could pick up another steal…

The true financiers amongst us will say that the money would have done better in the markets… And they’re probably right … But I prefer to own my home as a first order priority and will now put aside any excess cash for a market crash or the next big buying opportunity.

[an]

Congrats flu. However, I don’t think you can be serial refi-er going forward anyways, since rates are going up and not down. I don’t think I’ll be doing another refi again on my primary unless we see another 2008.

[Coronita]

[quote=AN]Congrats flu. However, I don’t think you can be serial refi-er going forward anyways, since rates are going up and not down. I don’t think I’ll be doing another refi again on my primary unless we see another 2008.[/quote]

True… 15 year are now around 1% higher than when I got my loan….

Somewhere I’m hoping I’ll hit the stock RSU lottery at the new company so I can quickly come up with a 50-60% down again on another home without touching any more of my current net worth….Ha ha… yeah right….

[an]

[quote=flu][quote=AN]Congrats flu. However, I don’t think you can be serial refi-er going forward anyways, since rates are going up and not down. I don’t think I’ll be doing another refi again on my primary unless we see another 2008.[/quote]

True… 15 year are now around 1% higher than when I got my loan….

Somewhere I’m hoping I’ll hit the stock RSU lottery at the new company so I can quickly come up with a 50-60% down again on another home without touching any more of my current net worth….Ha ha… yeah right….[/quote]You and me both flu. Here’s to an awesome 2016. Maybe we both can meet in Tahiti when our RSU lottery hit.

[HLS]

[quote=harvey]Did all the refinancing really pay off? Typically a refi takes a few years before the interest savings is break-even with the costs. Seems unlikely that one would come out ahead with several refinances….[/quote]

When getting a no cost loan and refinancing to a lower rate it, you start to save interest and benefit from day one; the day your new loan funds.

There is no future ‘break even’ period, you just need to understand the options when refinancing.

[Author]

Posts