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Learning, Sharing, and Teaching => Real Estate and Landlording => Topic started by: megan1104 on March 22, 2019, 11:36:55 AM

Title: Recommendations for Possible Refi to 15-Year Mortgage
Post by: megan1104 on March 22, 2019, 11:36:55 AM
Hi everyone,

I was curious if the MMM crowd has recommendations on the best companies to consider for refinancing a mortgage from a fixed 30-year to a 15-year version. My wife and I are not FI, but want to get there ASAP. The biggest financial albatross we have is our mortgage. We've started ramping up how aggressively we are paying our current mortgage down but want to run the numbers if it's better just to refi to a 15 year. Here's some info:

Original 30-yr mortgage principal: $415,000
Start date of mortgage: July 2015
Current principal: $374,000
Current interest rate on 30-year: 3.875%
Current value of home: $900,000

We have started making an additional $1000 payments on the principal every month. If we hold on that, we would pay off the mortgage in about 13.5 years or 2032. I would like to be able to run the numbers to see if it makes sense to add another 1.5 years back onto the mortgage and pay for closing costs. If possible, I don't want to pay for services I don't need. Are there online companies that can help with this process that don't involve loan brokers taking a commission and/or tipping the scales toward products that favor them? If so, which are the best?

I realize that I dropped a lot of info and questions in here, but I'm basically looking for recommendations for good mortgage companies -- online or otherwise. I'll take any additional advice if someone has it about the bigger strategy given our situation!

Title: Re: Recommendations for Possible Refi to 15-Year Mortgage
Post by: waltworks on March 22, 2019, 02:09:33 PM
Why do you want to pay off a <4% mortgage? It's like a built-in inflation hedge/free way to invest in more lucrative things.

Really, having a paid off $400k mortgage would be a bigger albatross, statistically speaking.

Regardless, assuming you want to pay it off as quickly as possible, you should probably just funnel money into the existing mortgage, since the going 15 year rates right now aren't meaningfully lower than that. There will always be some costs to refinance, which you can pay up front or via a higher rate - when all is said and done, you're not going to save anything meaningful by doing that if your current rate is 3 7/8.