Monday, October 24, 2011

Project Refinance

Well.  October is a wicked busy month here at Casa Handy Man.  We have a ton of activities scheduled for this month.  Most of them are fun, but we decided to add refinancing the house to the mix.

Interest rates have dropped, so we decided to refinance.  Our new rate has been reduced by two and an eighth percent.  That doesn't sound like a lot, but it makes a big difference in the life of a mortgage payment.  
Wish this pile of money belonged to me!
The process has been kind of a pain, but we managed.  We contacted one mortgage company, and had to get a house appraisal.  Bad news: the house appraisal didn't come in high enough.  Rob contacted a second company. They sent out another appraiser, and guess what?  Someone else said it's worth more!

Funny how that works, huh?

We had to cough up some money for this whole shebang; and Rob had to endure several phone calls and emails. (Notice I let him tackle this project.) But it finally worked out, and today we signed about 85 pieces of paper to make it official.  Now we are the proud owners of a smaller mortgage payment, and we'll save about eleventy-billion dollars in interest over the course of several years.  

All this from a measly two and an eighth percent difference in interest.  Go ahead, check an online mortgage calculator.  Enter some different interest rates, and you'll be amazed!

We plan to take the money we're saving every month and apply it to the mortgage.  We were used to paying $X anyway, might as well keep paying it, right?  This way, we'll (hopefully) be able to pay it off early.

If you're interested in refinancing, talk to a few different banks or mortgage companies to check out your options.  You can start by making phone calls to gather information, or you can gather info on the web.  Remember: you don't need to commit to anything up front, and don't let anyone tell you differently.

I know house prices have decreased significantly, but don't assume you don't have enough equity. You never know. 

I know it's boring, but read all the fine print to make sure you know what you're signing.  We've signed paperwork for three mortgages over the years, and this is our second refinance.  We're familiar with the paperwork now, but if you're not, ask someone to explain it to you.

Have you refinanced a home recently?  How did it go?

Back to October business.  School events, fall decorating (I haven't decorated yet, can you believe it?!) and of course, Halloween, a big favorite here.  See you for Wicked Awesome Wednesday!


Erin said...

I bet that feels great! Good job, you two!

Becky@OrganizingMadeFun said...

We refinanced three times in the last four years - two of those times in a month! I completely understand the paperwork. My husband thought for sure we'd never see interest rates that low again, then the change drastically lower a few weeks after and we did it again. Then, a year later, again! So, we're saving hundreds of dollars every month on our mortgage each time we've refinanced, so it's worth the pain!

Becky B.
Organizing Made Fun

Pink Overalls @DIY Home Staging said...

A really helpful post. This is the kind of practical advice that more blogs should share.

How smart of you to put the extra cash towards your principal. That will save big bucks, too!

Handyman in London said...

October seems to be very busy month for you. You have loads of work to do, best of luck guys.

thatgirlcate said...

We renegotiated three times in the most recent four years - two of those times in a month! I totally comprehend the printed material. My better half thought for beyond any doubt we'd never see loan costs that low again, then the change radically bring down a couple of weeks after and we did it again. At that point, after a year, once more! Along these lines, we're sparing several dollars consistently on our mortgage every time we've renegotiated, so it's justified regardless of the torment! mortgage rates Vancouver

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