Why We’re Not Refinancing Our Mortgage
With mortgage rates at all time lows, I’ve seriously been considering refinancing our mortgage. We actually have two mortgages: a first mortgage and second. When we purchased our house, we decided to take money out of savings to pay off some student loans so that we would be qualified to spend more on a house because we didn’t have as much debt. So instead of having a larger down payment, we opted to do an 80/15/5 to avoid paying PMI (private mortgage insurance). I feel good that we at least put that 5% down. I’d love to get rid of that second mortgage and combine it with the first, but our loan to value is not low enough now to avoid PMI. Oh well.
I’ve run the calculations, and to break even from the points and whatever from refinancing, it would take us about two years. I think that with us being unsure about where we want to live permanently it wouldn’t make any sense to refinance now. Who knows if we’ll be in the house in two years? I’m pretty confident that we will be just to break even with the value of our home (we’re hoping) but I guess we can’t predict the future. If we lived in the same state as one of our families, I’m sure we’d stay in our house forever.
If you own your own home, are you considering refinancing?