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Re-financing Now
Old 01-31-2008, 02:30 PM   #1
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Re-financing Now

Anybody jumping on the re-fi wagon now while rates are still low?
I signed into a 5/5 ARM 2 years ago (probably bad idea) at 5.75% and am wonderinfif I should jump to a 30 year fixed which today is possible at around 5.35%.

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Old 01-31-2008, 02:31 PM   #2
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Have you compared the costs?
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)

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Old 01-31-2008, 02:39 PM   #3
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Not yet. Thought maybe someone brighter than I (many) may know an immediate reason to jump or not given the bare info I provided. Obviously I need to get some numbers together and will be as soon as my kids give me 30 seconds alone.
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Old 01-31-2008, 04:23 PM   #4
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Do you mind telling me where you can get 5.35 on a 30yr? Rates have gone up considerably in the last few days on the rates I watch?
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Old 01-31-2008, 06:22 PM   #5
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USAA is showing 5.25, 30 years with 1.625 points.
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Old 02-01-2008, 10:24 AM   #6
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pen fed was showing rates on 15 year fixed yesterday
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Old 02-01-2008, 10:39 AM   #7
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I'm in the process of refi'ing from a 30 year fixed at 5.75% at USAA to a 15 year fixed at 4.625% at PenFed. For me I didn't even really have to run the math very hard because I knew it was a great deal for me. Over the next 15 years I'll be saving $22,000, and I'll then get an additional 14 years of no mortgage payment, which is worth another six figures to me. My closing costs will be (I think) under $1,000.

Based on the numbers you gave, you're not going to hit break even on your refi for a very long time, so you're basically paying your closing costs in order to extend the fixed period on your payments. If I were in your shoes, I'd only do that if I knew for certain that I'd be in the house at least another 6-7 years, maybe longer, depending on the particulars of your current loan and what rates it might go to when it resets, as well as what the closing costs on the new loan will be. Also, if your current mortgage payment is a challenge for you to afford, you might need to refi just to avoid the risk of getting into an unaffordable payment situation when your current loan resets.

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