I'm trying to determine if it's worth it for us to refinance. I've shopped around for rates and have gotten a written quote from a lender. We live in a HCOL area, so the amounts seem face-punch worthy, but really are not.
Current Loan - 15 year fixed at 3.875%
Original Amount - $220,000
Amount Remaining - $202,000
Payment (Principal and Interest) - $1613 (we pay $2000)
We are 1 year into the loan and are scheduled to pay it off in 10 years and 5 months from now.
New Loan - 15 year fixed at 2.875%
Loan Amount - $209,000 (we would add closing costs and the up front escrow amount for property taxes..we have to escrow if we want this rate)
Payment (Principal and Interest) - $1430 (we would continue to pay $2000)
We would pay off the loan in 10 years and a half a month.
Rates are lower for a 15 yr fixed then they are for a 10 yr fixed, so it's better to take the 15 year loan and pay it off early then to do a 10 year loan. We could liquidate some of our brokerage account to cover closing costs but I'd rather not since stocks are down and the rate is so low.
Basically, it would save us $10k in the long run. What do you think? Is it worth it? Also, I understand there is much heated debate regarding paying off a mortgage early vs investing, but we are comfortable with paying off the mortgage in 10 years and we are maxing 401Ks and IRAs for both of us. Thank you in advance for any advice.