Refinancing our home, is this a good deal?
by Mortgage Rates on Sunday, September 26th, 2010 | 10 Comments
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Just don’t get in over your head because even though it’s worth X$, you may want to sell in the future making it impossible to pay off the loan… and if you can, pay closing costs up front don’t roll it in the loan. Make sure it is a fixed rate…why isn’t 7% ideal? Can you get much lower?? without a credit score of 800??
You have to decide what is best for you. Do you feel it is worth paying off a truck loan and rolling it into a 30 year loan? If you do not want the extra cash then I would not take it. There is no reason to pay a higher payment because of soem extra cash out. You might be able to do better on the rate, are you getting charged points? If you are comfortable with a fullyammortizing payment I think you should take it, if not you can still take the interest only and pay down accordingly. There are many other things to consider here also, you need to look at your long term plan with your home and whether you are going to live there for a lon time or not.
Depends on what your variable rate is going to be. Right now interest rates are very high, so i wouldn’t generally advise refinancing at this time.
Definitely a better deal! Even with the 7%, considering current market for mortgages and your (assumed) credit rating, that’s not a bad deal. Once your stuff is all paid off, you can wait it out a couple years and when your credit improves you may be able to refinance again into a lower rate. Interest-only is never a great option, so I’d get out of that one ASAP regardless of what your interest rate is. Even if it’s higher, at some point you’ll be paying off principal, even if it is only a few dollars at a time. If you have any more questions, you can email me direct at chris4realestate@yahoo.com Good luck!
My calcs show 1800×30 years plus 10G as a $270,000 loan.
The extra 70G will cost you 170,000 over 30 years.
IMO taking your short term loans such as your truck payment and turning them into a 30 year loan is not a sound financial decision. If you are having trouble paying an interest only loan on your current mortgage and maxing out your credit cards you are already over budgeted. It is your debt and your purchasing decisions that are the problem. IMO you need to get control of your finances before committing yourself to this type of mortgage. Based on your question, I would guess that this would only be a temporary fix to your current financial problems. Your current habits would create additional future debt. Then you would be paying 30 years worth of interest on your current debt and the additional interest on your future debt if you do not change your habits. You need to keep what you have and work hard at paying off the credit card and vehicle debts. Based on your spending habits, I would venture to guess the 10G wouldn’t all go back to the principle either. No offense, just thinking aloud. Good Luck with whatever choice you do decide to make. Peace.
Although it sounds like a good idea, it really isn’t. As the other poster said, that refinance will cost you a bunch in the long run.
I would suggest you find out where the money is going, get yourself on a budget and work on an extended period of financial stability. Once you get your credit scores up, your debt down and the expenditures under control, then refi.
I have seen too many people use the equity in their home to pay off debt, only to be deep in debt again in a few years, with no equity to bail them out.
I can only recommend sitting down with a Primerica agent and have them complete a Financial Needs Analysis as well as a S.M.A.R.T. application. By doing this, you and the agent will have a complete picture of your finances.Trying to figure this out, here, is not helpful. You deserve to see your situation on paper. See it for what it is. Suggestions will be made, including what can be done to help you with a debt elimination program.
I sat down with a client and was able to get them out of debt within 15 years, this ended up being 200+ years earlier than if they had stayed in their current situation. At the same time, their retirement was also being taken care of.
Please give careful consideration to this. Email and I will help as best I can.
Yes getting a 7% fixed is way better than having your present loan go variable.
i cant get you 6% No Obligation! call me 631-673-6100 ext 3506 joe giunta
Get away from an interest-only loan as soon as you financially can. Sounds like a pretty good fixed mortgage.
Due to what the bond market has been doing this week, 7% isn’t too horible. Also, without knowing what your closing costs are, I can’t determine exactly how far off, if any, your loan quote is. I am curious, however, if you are paying $10,000 toward principal right after closing, why not just decrease your loan amount? Your monthly payment will be lower if you only finance the lower amount. Depending on what your credit scores are, if you have had clean credit for 12 months, you may be able to get around being penalized for your past credit history. FHA is one way to do this and they do not have credit score requirements. They, do have loan amount limits that vary by county, though. The maximum FHA mortgage limit in my county (King county in Washington state) is $362,790.