brewer12345
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Mar 6, 2003
- Messages
- 18,085
Hundreds of thousands? You mean in the retirees as a group or are those retirees choking horses with the roll of bills they are putting into certificates?
Now here's something I'm considering: Let's say I have a $100k 5/5 mortgage on my house that I took out with PenFed 1.5 years ago. The interest rate on that is 3%.
PenFed is offering their current no cost 5/5 home loan for 2.625%, though there are extra hoops a current PenFed mortgage holder has to jump through (middle of last year you had to borrow $50k more than the current loan and the new loan had to be 80% LTV). If one could meet PenFed's conditions for a 5/5 loan is there any reason NOT to make a new 5/5 loan, paying less interest than one is making on the certificates and moving the payoff date out another year or so? $375 interest savings/$100k/year?
It would certainly be hard to hurt yourself this way. One thing you would want to be careful of is effective tax rates. If the 3% is taxed but the mortgage isn't fully deductible due to the standard deduction being bigger than the amount of the extra interest, this does not work.