11-14-2012, 03:50 PM
So I'm looking into refinancing my mortgage.
We've been in our house 17 years. We paid off our original mortgage about 11 years ago (we got the house for a very low price).
We took out a 30 year loan to do some remodeling about 7 years ago, and refinanced that loan about 3 years ago, going from a 30 year loan at 5.5% to a 20 year at 4.25%.
We still have 17 years left on the 20 year loan, but can now refinance to a 15 year loan (cutting off 2 years) at 2.75% (compared to the 4.25% we now have).
If our current monthly payment is $1500 per month (these are not the real dollar amounts, for the record), and we still have 17 years left, and the new loan would drop our monthly payment to $1000 for 15 years, am I correct in stating that we would save $126,000.00 by refinancing?
$1500 x 12 x 17 = $306000.00
$1000 x 12 x 15 = $180000.00
Difference = $126000
Is there anything I'm forgetting?
I know that if we pay more than our required monthly payment, this would affect the length of time to re-pay, and also the total amount paid.
I also know we need to subtract the amount we will pay in closing costs (roughly $3000 - $3500).
Thanks for helping out.
We've been in our house 17 years. We paid off our original mortgage about 11 years ago (we got the house for a very low price).
We took out a 30 year loan to do some remodeling about 7 years ago, and refinanced that loan about 3 years ago, going from a 30 year loan at 5.5% to a 20 year at 4.25%.
We still have 17 years left on the 20 year loan, but can now refinance to a 15 year loan (cutting off 2 years) at 2.75% (compared to the 4.25% we now have).
If our current monthly payment is $1500 per month (these are not the real dollar amounts, for the record), and we still have 17 years left, and the new loan would drop our monthly payment to $1000 for 15 years, am I correct in stating that we would save $126,000.00 by refinancing?
$1500 x 12 x 17 = $306000.00
$1000 x 12 x 15 = $180000.00
Difference = $126000
Is there anything I'm forgetting?
I know that if we pay more than our required monthly payment, this would affect the length of time to re-pay, and also the total amount paid.
I also know we need to subtract the amount we will pay in closing costs (roughly $3000 - $3500).
Thanks for helping out.