Is it smart to refinance 6% to 4.75 my payment will go up 150$ a mth. I will payoff 26,000 for cars. its a 25 yr loan pls help me decide. My payments now are 800/mth and I owe for 23 yrs. I will save 700 a mth because of the cars for 5 yrs. Can someone do the math for a mother of 3 trying to save some cash.

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Post Posted: Thu Aug 05, 2010 9:25 pm    Post subject: Is it smart to refinance 6% to 4.75 my payment will go up 15
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Is it smart to refinance 6% to 4.75 my payment will go up 150$ a mth. I will payoff 26,000 for cars. its a 25 yr loan pls help me decide. My payments now are 800/mth and I owe for 23 yrs. I will save 700 a mth because of the cars for 5 yrs. Can someone do the math for a mother of 3 trying to save some cash... please help this mother of 3 do the math
Icon Mini Profile Niicss
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Post Posted: Fri Aug 06, 2010 2:20 am    Post subject:
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You need to decide whether or not you want to stay in the property for a longer period of time. If you want to stay in the house for next 8-10 years, then it would be an excellent option to refinance the loan and go for lower rates.

However, in order to get the refinance, you should have equity in your property. Apart from this, your income and credit scores would also be taken into consideration by the lender.

You haven't mentioned your mortgage balance in the post. Nevertheless, you can use the given calculator in order to find out what you can save when you refinance the loan:
http://www.mortgagefit.com/calculators/refinance.html
Icon Mini Profile jveenstra
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Post Posted: Fri Aug 06, 2010 2:43 pm    Post subject: Refinance
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msowder15:
Looks like you already did the math. If you save $700 for 5 years, that is a savings of $42,000.

No requirement, but, if you save that much a month, you could voluntarily pay something extra every month on the mortgage and pay off faster than the exising mortgage.

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Post Posted: Sun Aug 08, 2010 9:35 pm    Post subject: Refi to pay off 2 cars
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Hi Mom,
If you can a 4.5% and you now have a 6% thats a savings of 1.5% which translates to a 1,500 savings a year on a 100,000 mortgage. I say better in your pocket then the banks. Now the next thing whats the closing cost
involved with the new loan???? The morgage Co. or bank should supply
you with a goodfaith estimate, I myself would trust a bank more then a
mortgage company with these so called estimates after they are ESTIMATES but banks have a better handle on these cost.
There are two trends of thought on the cars and one is can you affort to just refi and continue to make the payments??? otherwise your stretching
a five year loan into a 30 year loan and paying 2.5 times of the amount
finaced for the said vehicles.
It has to do with you financial situation, here's another option you may want to ask your loan officer, how about a refi with both cars into a 20 year term, at least you would cut off 3 years from your present mortgage
and I dont believe it would be to much more per mont still resulting
in a nive savings and cutting your loan down by 3 years. One more thing
a 20 year mortgage may have a better rate and another thing to consider
would be to take some of the savings and each month and add it to your principal paying the loan off even quicker.
Hope this helps
Lou

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