Any one know anything about refinancing?

[sparky65]

I know we are a quite diverse group of people so I figure some one here might have some information on this. I am considering refinancing my mortgage with the same bank that I got my mortgage from a year and a half ago. There isn't much savings in monthly payments ~$30. The online calculators seem to differ on the amount of interest savings there will be. I would like the formulas so that I can calculate in excel how much of my monthly payment goes to principle and to interest each month and how that changes if I make additional payments to reduce the principle each month.

[Tungsten]

I always thought you had to pay closing costs again if you refinance? I get stuff in the mail all the time from Bank Of America wanting me to refinance. I currently pay my mortgage weekly to save in interest charges. It's great, my payment comes out of my bank account every Friday.

[79cobraII]

there are closing costs, and escrow costs, less so if you stay with your bank. If you change banks then the cost goes up.

the real question is will you save at least 2pts on the interest? if not then the extra cost is not worth the hassle.

i went from 6.5 to 4.25% my monthly went down about 200$ but my savings over the course of the loan is about 200,000$ i had to kick in about 20K to cover changing banks and setting up a new escrow and refilling my TAX escrow.

if your trying to save 1pt or less its not worth it. you would be better off making extra payments and try to shorten the loan instead.

you need a amortization calculator.

then you can try and figure out the savings.



http://www.amortization-calc.com/
^ try this one

I'm not sure about the correct formula but there are tons of them online that can show you a spreadsheet of the payments

[Hiker]

Buy an HP-12C. You can get them on eBay for around $30.. great for amortizatizing and other stuff.

[sparky65]

Originally Posted by Tungsten

I always thought you had to pay closing costs again if you refinance? I get stuff in the mail all the time from Bank Of America wanting me to refinance. I currently pay my mortgage weekly to save in interest charges. It's great, my payment comes out of my bank account every Friday.

I added up the costs from the bank and attorney and it comes out to ~$2200.
I would be going from a 5.25% 20 year to a 4.375% 15year.

The calculators are okay but they don't let me vary the monthly payment. The reason is I expect at some point maybe 5years down the road interest rates will go back up so that it wont be worth it for me pay off more principle each month. Also at certain times of the year when bonuses and the like get paid i would make a larger payment that month. That's why I was looking for a formula.

[phthaloblu]

When we refinanced at the end of last year, we did the same thing. We went from 8.24 to 6.24, I think it was. From a 30 year to a 15 year. My husband figured out it would save us over 150K over the course of the loan. I don't remember the exact number, but it was significant. And I rather like knowing the house will be paid off in another 14 years instead of dragging it out. We want it paid off before he retires.

[66DavesGT]

It never ceases to amaze me the # of people thinking paying off more principle every month "is not worth it". You'd be surprised how just making 1 extra payment per year whittles your loan down fast! Or just take that 1 extra payment, divide it by 12 and put that amount in as extra principle. Every little bit extra helps!

[magician]

Mortgage Calculator | Payment Calculators by Bankrate.com

[daves67ss]

You won't find any calculators that allow you to put in different payments in different years. You would have to create your own. (It can be done in excel.) You'll find ones that allow for a fixed payment each month. Crunch the numbers. Any way to go to 10 years? If you make the jump, make it for the best bang for the fees you'll have to pay. In the meantime, there is no reason not to pay more principal.

Now to digress. You can earn more money in the stock market in the long run than paying off you mortgage early. We refinaced from 30 years to 15 years about 6 years ago. We did this for two reasons, to have the house paid off several years before retirement and to reduce the intrest rate as much as possible. I have thought about paying more, but decided I was better off making the normal payment and socking as much into my 401K as possible instead. I'll be 60 when the house is paid off.
Dave

[erzyhazel]

sorry... but i don't know.