(Refinance to low mortgage AND High Interest Education Loan) OR (High Mortgage Interest AND No Education Loan)?

One Response to “(Refinance to low mortgage AND High Interest Education Loan) OR (High Mortgage Interest AND No Education Loan)?”

1. Alex says:

   September 25, 2010 at 1:15 pm

   First, start a savings account so your money can earn interest (however little) instead of sitting in a checking account. Do you have a budget and how much can you apply to savings or extra debt payments in the next year? If you don’t have a budget, start one immediately. Check out DaveRamsey.com, mint.com or spend a few bucks on Quicken (personal finance software).

   Paying off the secondary mortgage will leave you with very little emergency savings. An emergency fund is extremely important in case of job loss, medical emergency, car accident or some other unforseen major expense. Option 2 is better IF you can replenish the emergency savings within a few months and there is very little risk of job loss or income reduction. If possible, I would save every penny you can for a few months to build up the savings before taking this major step. Aren’t there fees for refinancing the ARM to a fixed mortgage? Does tuition cover all the costs of school?

Leave a Reply

Click here to cancel reply.

Name (required)

Mail (will not be published) (required)

Website

CAPTCHA Code *

Notify me of followup comments via e-mail