ideas how to reduce mortgage payment w/o refinancing?

Discussion in 'Financial Planning' started by dmill945@yahoo.com, Feb 2, 2012.

  1. Guest

    Looking for any ideas on how to reduce monthly payments on a mortgage
    that's mostly paid up ($90k principal left), to pay off in 10-15 years
    without the cost of refinancing. Things I've looked at so far (and
    disadvantages of each):

    1. HELOC - variable rate, likely rise over next 7-10 years (up to
    8-10% range?)

    2. Home equity fixed rate loan - rate quotes now are 7-9%, much higher
    than a refinance or a HELOC (is that typically the case?)

    3. Refinance - closing costs; also wary of bank appraisal (house could
    use some paint, minor repairs that I just ignore) but maybe not a
    concern since LTV of about 0.2 is so low.

    Any other suggestions out in left field? Thanks.
     
    , Feb 2, 2012
    #1
    1. Advertising

  2. Ron Peterson Guest

    On Feb 2, 10:44 am, wrote:
    > Looking for any ideas on how to reduce monthly payments on a mortgage
    > that's mostly paid up ($90k principal left), to pay off in 10-15 years
    > without the cost of refinancing.  Things I've looked at so far (and
    > disadvantages of each):



    > 3. Refinance - closing costs; also wary of bank appraisal (house could
    > use some paint, minor repairs that I just ignore) but maybe not a
    > concern since LTV of about 0.2 is so low.


    What is your current interest rate?

    If your new loan is at a higher rate, you will lose financially.

    Are you willing to sell your house and rent or buy a smaller house?

    If you refinance, I think a larger loan could be used to increase your
    cash position.

    --
    Ron
     
    Ron Peterson, Feb 4, 2012
    #2
    1. Advertising

  3. bo peep Guest

    On Feb 2, 11:44 am, wrote:
    > 3. Refinance - closing costs; also wary of bank appraisal


    You could refinance just the balance at your local credit union
    instead of the bank. I checked my credit union's rate just now - on a
    15 year fixed, it is 3.125% with no points, which is much better than
    their HELOC rate.
     
    bo peep, Feb 4, 2012
    #3
  4. JoeTaxpayer Guest

    On 2/4/12 12:07 PM, bo peep wrote:
    > On Feb 2, 11:44 am, wrote:
    >> 3. Refinance - closing costs; also wary of bank appraisal

    >
    > You could refinance just the balance at your local credit union
    > instead of the bank. I checked my credit union's rate just now - on a
    > 15 year fixed, it is 3.125% with no points, which is much better than
    > their HELOC rate.


    OP never mentioned his current rate.
    When I talk to people with 10 years left, but at 7%, I remark that at 4%
    or less, the 3% savings would pay for some closing costs in a few months
    depending on balance.
    Many banks have a low or no closing cost mortgage at a slightly higher
    rate. It's easy math when you have all the numbers.
     
    JoeTaxpayer, Feb 4, 2012
    #4
  5. FranksPlace2 Guest

    On Feb 2, 12:44 pm, wrote:
    > Looking for any ideas on how to reduce monthly payments on a mortgage
    > that's mostly paid up ($90k principal left), to pay off in 10-15 years
    > without the cost of refinancing.  Things I've looked at so far (and
    > disadvantages of each):
    >
    > 1. HELOC - variable rate, likely rise over next 7-10 years (up to
    > 8-10% range?)
    >
    > 2. Home equity fixed rate loan - rate quotes now are 7-9%, much higher
    > than a refinance or a HELOC (is that typically the case?)
    >
    > 3. Refinance - closing costs; also wary of bank appraisal (house could
    > use some paint, minor repairs that I just ignore) but maybe not a
    > concern since LTV of about 0.2 is so low.
    >
    > Any other suggestions out in left field?  Thanks.


    Go to your current mortgage holder, tell them you are considering
    closing out the loan and ask them to instead reduce your current rate
    by say 2 points.
     
    FranksPlace2, Feb 5, 2012
    #5
  6. DA Guest

    responding to
    http://www.beansmart.com/financial/ideas-how-to-reduce-mortgage-payment-w-o-refinancing-17614-.htm
    DA wrote:

    dmill945 wrote:


    > Looking for any ideas on how to reduce monthly payments on a mortgage
    > that's mostly paid up ($90k principal left), to pay off in 10-15 years
    > without the cost of refinancing.


    It's still a refinancing but I have seen ING Direct advertise "low closing
    costs" mortgages where they claim savings by not paying at least part of
    the normal closing costs and points. Their 7/1 ARM is 3.396% APR and,
    although does not cover the entire 10 yr period you want, it *almost* gets
    you there. There is some small print there, too, so you'd have to contact
    them to see if it's really all that great, but sounds pretty good on the
    ad.

    I would think the appraisal would not be such a big deal in refinancing,
    at least as far as you get it appraised at 20% over the amount you borrow
    to eliminate the PMI insurance costs.

    -------------------------------------
    |_/|
    | @ @ Woof!
    | < > _
    | _/------____ ((| |))
    | `--' |
    ____|_ ___| |___.'
    /_/_____/____/_______|
     
    DA, Feb 7, 2012
    #6
  7. DA Guest

    responding to
    http://www.beansmart.com/financial/ideas-how-to-reduce-mortgage-payment-w-o-refinancing-17614-.htm
    DA wrote:
    FranksPlace2 wrote:

    > Go to your current mortgage holder, tell them you are considering
    > closing out the loan and ask them to instead reduce your current rate
    > by say 2 points.


    I would think that by now they have already sold the mortgage higher up
    the chain and are only involved in servicing it (collecting your
    payments). In other words, they would love to do something to prevent
    losing you as a customer but I don't think they can actually do anything
    about it 'cause it's not even their money anymore.

    I'm pretty sure that's how it works with smaller banks but couple years
    ago I've also attempted to do just what you suggested with Wells Fargo.
    Despite being one of the few big ones still standing, they simply said:
    "go ahead". So I did and refinanced with a small local bank.

    -------------------------------------
    |_/|
    | @ @ Woof!
    | < > _
    | _/------____ ((| |))
    | `--' |
    ____|_ ___| |___.'
    /_/_____/____/_______|
     
    DA, Feb 12, 2012
    #7
    1. Advertising

Want to reply to this thread or ask your own question?

It takes just 2 minutes to sign up (and it's free!). Just click the sign up button to choose a username and then you can ask your own questions on the forum.
Similar Threads
  1. Replies:
    2
    Views:
    425
    A.G. Kalman
    Jul 19, 2005
  2. Replies:
    1
    Views:
    291
    thetaxdon
    Feb 9, 2006
  3. Leigh Menconi

    Can mortgage prepayment reduce minimum payment?

    Leigh Menconi, Apr 28, 2004, in forum: Financial Planning
    Replies:
    13
    Views:
    923
  4. Andrew
    Replies:
    13
    Views:
    1,029
  5. Duncan Smith

    Reduce mortgage term or monthly payments?

    Duncan Smith, May 14, 2007, in forum: UK Finance
    Replies:
    3
    Views:
    822
    user0123456
    Jul 13, 2012
Loading...

Share This Page