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.
- What is a rate and term refinance?
Homeowners have a variety of reasons for refinancing and each reason can indicate that one refinance option or another makes the most sense.
- Are ten-year fixed-rate mortgages (FRM) available anywhere?
Sure! Virtually all lenders who sell product to Fannie Mae or Freddie Mac will be able to offer you mortgage with a 10-year term. However, interest rates are usually the same as the lender's 15-year offerings.
- Can I get copies of checks from a past refinance?
It's not going to be easy, that's for sure.
- Can I refinance an underwater ‘kiddie condo’?
If the home is underwater, HARP is really your only option.
- Will shopping around for a refinance affect my credit?
Credit bureaus usually treat multiple applications to different lenders as a single entry in your credit file.