Hello, and first - thank you all for your indulgences with all my questions! My next phase in my financial development is I am going to look to a cash out refi, getting out the maximum amount of cash I can get.
Mortgage: 259k
Value: redfin value 500k, bank site has value potentially 385-525, with estimate of 445
Rate/terms: 4.375%, year 8 on a 30 year mortgage
Overall details on my financial situation are presented in a case study (wonder what you all will say to me) - But the broad message is that I was starting to drown a bit last year when I had to start paying back student loans for older child. Younger child has 2 more years. I got a promotion and large pay increase and I am now able to pay down the consumer debt (cc and personal loan) I acquired - and I am on track to have all of that cleared by end of 2019, possibly a little sooner.
Currently, cash flow is a little tight. I have been working on budgeting and making good headway there in cutting back and on understanding my outgo much better. I am nearly at a paycheck to paycheck situation. I have 6% into 401k, and have started a baby EF with $100/month.
While that isn't a lot of savings going on!!! I do feel good about my ability to clear out that consumer debt by end of the year, continue to trim the monthly budget as I can, and then I would be able to go to 10% 401k and save perhaps 500/month in the EF. I think that that is good enough for me right now as a goal and I would do okay going forward.
But - I still have 115k in student loans and more tuition bills coming up. While I am paying for the ones I took out on older child, the loans for younger child are deferred, but gathering interest - so what I pay on in principal on DS, I accrue in interest on DD. So currently, just keeping even on that.
My plan was to use the home equity to pay off remaining consumer debt, pay for year 3 college expenses, and if I can get enough cash out, pay off a few of the higher interest student loans I currently have.
then through this academic year, save as much as I can for the last year of college and use the university yearlong payment plan for that.
cost of attendance is about 38k/year (35k tuition, room, board, 3k books, other related expenses, any incidentals. DD will have 7500 loan in her name, will contribute about 1500 from summer job. She will try to get some PT work for incidentals this year at school, but that is not secured yet so not putting into calculations.
So - about 29k is needed for this year. 12 month payment plan is about 2500/month, need to start that in june of previous summer. 9 month payment plan is about 3250/month. Not in the budget at all.
I would likely get about 80-100k cash out. 29 for third year, 7 to consumer debt, pay off about 50k of existing loans.
but for 4th year, I'm hoping that I can save up about 10k after paying off several debts/reducing monthly payment. And then have something looking like 1600/month payment for 4th year starting in June of 2020. Everything must be paid off to get diploma. I might need to get some small loans that last year but if I pay off 50k of student loans now, they are down to about 65k, and maybe up to 75k if I need a small loan for DDs 4th year.
I know I am really just moving debt around here, and not really reducing it. But I was thinking that this is a way to get better terms on a large amount of debt. I am hoping that taking another 30 year mortgage that the payments would stay same/increase just a little bit.
Am meeting with a mortgage person next week. What should I be thinking about? What should I ask mortgage person?
appreciate your thoughts!
