Refinance my two mortgages into one?

Q; I currently have a Cal-Vet loan of $220,000 at a 4.5 percent interest for 25 years. I have already paid 5 years on this loan. I also have in place a second lien of $30,000 at 7 percent for 15 years. I already paid 5 years on this second.  Should I refinance both loans together for 15 years.

A: With 20 years remaining on your first mortgage and 10 on your second, you certainly could consider refinancing them into a single loan. Open-market interest rates are unlikely to be substantially better than what you have now on your first mortgage, so consolidating them together for a shorter term will probably cause a rise in your total monthly payment. By our reckoning, that increase would be less than $35 per month, but you could save a bundle of money by not having those additional five years of mortgage payments. If you have sufficient equity in the home and your credit is good, it sounds like a good idea to us.

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