Bestwifeever
Moderator Emeritus
- Joined
- Sep 17, 2007
- Messages
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Thoughts on this thread (and who knew we could have a fresh thread on refinancing vs. paying off the mortgage! It's an e-r.org miracle!):
I think the author of the linked story is making his own assumptions. Maybe people are not re-fi-ing for cash out simply because they don't have enough equity left (I know several serial re-fiers) or the banks aren't doing it; some are bringing money to the table to re-fi because they have to with their underwater mortgage (DD is in this position) to take advantage of several percentage points of lower rates, not because they "want" to.
When the pre-boomer generations paid off their mortgages, refinancing was not an option. If they didn't move, their mortgages got paid off sooner or later.
Re the percentage of retired people holding mortgages is getting smaller, some retired people don't have mortgages because they rent--maybe there are more renters in our cohort than previously.
One thing about paying off the mortgage--at least at the moment you do it, you have the exact same net worth, but now part of it is likely less liquid. Is liquidity always important?
And finally--refinancing to pay off your mortgage is like getting your hair cut because you want to grow it out. And in some cases you might then say, hmm, I like it this way after all, I won't pay it off/grow it out.
I think the author of the linked story is making his own assumptions. Maybe people are not re-fi-ing for cash out simply because they don't have enough equity left (I know several serial re-fiers) or the banks aren't doing it; some are bringing money to the table to re-fi because they have to with their underwater mortgage (DD is in this position) to take advantage of several percentage points of lower rates, not because they "want" to.
When the pre-boomer generations paid off their mortgages, refinancing was not an option. If they didn't move, their mortgages got paid off sooner or later.
Re the percentage of retired people holding mortgages is getting smaller, some retired people don't have mortgages because they rent--maybe there are more renters in our cohort than previously.
One thing about paying off the mortgage--at least at the moment you do it, you have the exact same net worth, but now part of it is likely less liquid. Is liquidity always important?
And finally--refinancing to pay off your mortgage is like getting your hair cut because you want to grow it out. And in some cases you might then say, hmm, I like it this way after all, I won't pay it off/grow it out.