If you're paying 10k to refi a 300k loan, you're getting bent over in every direction imaginable...
I don't have that number yet..but only doing this based on how that number works out
Originally was thinking it would be close to $200 less, but looking like closer to $150...so little less desirable
so I've said it many times in this thread...the loan is bigger and the term is longer
I'm aware of that. So yes...that is 'losing $$'
but lowering fixed costs TODAY is way more desirable to me
That's my main goal is getting my fixed monthly costs as low as I can
a lot of people might not want to put the effort in to save $150 a month, I'm fine with that..especially since it's a cost I'm on the hook for 360 months
This is my understanding of breaking down closing costs
closing cost total last time was $8k...but half of that was costs that I was already going to have to pay
So real sunk costs to me were in the $4k range
Origination - this was close to $2k last time
this is the number I'm looking at this time around as they said they would cover 'their closing costs'
Title/title insurance/other fees - This is where you can get fleeced a little. the original quote was $1550, shopped around, and got it under $1200. I'm hoping this time I can 're-new' the title insurance... could get that number closer to $900
Gov't cost...this is a loss and was just shy of $1k
4k for 'closing costs' last time
I'm hoping that is around $2500 this time
I guess that is where your break-even math comes in. If I have to spend $2500 to save $150 a month, then 16 months is my break-even
Then there are things like pre-paying insurance and the property tax for escrow
for me that was about $4k....but that was money I was going to pay out regardless
The only difference is I financed that 4k in the loan and won't have to come up with that 4K in 2020 (more money not being spent today...but over the life of the loan)
So if I pay $X for Principal and interest today
and after 10 hours of paperwork, I'm paying x -$150
Seems like I'm not having to shell out $150 a month today and for the next 360 months...seems like a good deal to me
even if over the course of the loan I'm paying more
Now I could come up with all of the closing costs at signing (lets say 6.5k)
I could pay $178 less a month
but paying the $28 a month for to cover that 6.5k seems ok in my book as long as my monthly outlay is $150 less
