Tuesday, July 17, 2012

To Finance...Again

Once again 30-year mortgage rates are at record lows, 3.56% to be exact.  It seems like this happens every couple of weeks.  This time I was bored enough to see what kind of impact a refinance would have on my mortgage.

My current mortgage is a 30-year at 5% with $158,000 outstanding and 29ish years left which is a monthly payment of about $858.  Using this handy refinance calculator, I would save $129.37 per month and $45,019.31 in interest over the life of the loan.  Now the question is, will it be worth it.  When we purchased our house we payed $2,300ish in closing costs.  Which means it would take 18 months to recoup the cost of refinancing and then we would be pocketing that $129.37 every month for the next 27 years.  Sounds like a pretty easy way to save some money.

One problem for me and Mrs. K, we are lazily looking for land to build a new house.  So it's kind of a gamble on whether or not we would still be here (in this house, not dead) in the 18 months it takes to make back the closing costs on a refinance.  However, if it wasn't for that, we would be refinancing as I speak...err type.

What is your mortgage situation?  Have you already refinanced recently or are you looking into refinancing now?  Or have you given up on the whole home ownership thing?

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