Mortgage Blog

Usually when we see some small loans, we
will not recommend to refi. But after
some rearch today, you will save
some money in some cases.

Here is an example:
I have a friend who has 15 yr fixed loan
with the rate 4.75% originated 7.5 years
ago with loan amount 300k. And the balance
is around 150k now.

Is she does not refi, after 5 years, she will
have a mortgage balance of around $30k if she
kept mortgage payment of $2600 per month.

But if she just needs to refi with current
5/1ARM with closing cost, she can payoff this
loan within 5 years with the current $2600
monthly payment.

So indeed she can save around 28k to 30k
from the refinance.

One lesson learned here: borrowers are always
smarter than the loan originators.

Thanks for redaing, have a good day.