Wednesday, September 18, 2019

The refi is finished!

Yesterday morning, M & I signed all of our refinance papers on our mortgage before work. I'm so happy that all of the work is complete & I can mark it off of our list.

For the financial side, finishing the refi lowers our payment by $1657/month, giving us a significant amount of flexibility. We also dropped our interest rate by almost a full point, and paid zero costs or fees with the refinance.

We opted for a 7/1 ARM vs a traditional 30 year mortgage, and made quite a bit of progress of paying down the principal in the 2.5 years we've owned the house. As a result, we were able to get a loan for $217k less than the loan we had when we bought a few years ago. This also helped to lower the monthly payments.

In reality, the seven year time horizon on the arm is great for us, as Nick graduates from high school in seven years. Our plan is to have the house either paid off (optimistic, but stretch goal) or have firm plans in place to relocate to a less expensive house at that point. Either way, paying 1 point less on our currently large balance vs the balance we'll owe in seven years makes sense.

Our goal is to continue to make the same payments each month, regardless of the lower required payments. That will set us up for success in getting the house paid off or paid to a very low amount by the end of seven years. We're excited about the flexibility we have in the payments (should we need to pay less for a few months due to an emergency, we certainly can) & the ability to put more towards the principal in standard months.

Have you recently refinanced your house? Any good success stories?


  1. Wow! That is a significant reduction. Good job! Good luck with paying your home off. It is the best thing you can do for yourselves before you retire.

  2. Wow, that is such a huge savings and so nice to have the flexibility of a lower payment yet be able to continue to make the higher one when you can to pay down the mortgage. So glad that worked out for you and that the pain of it is behind you now.

  3. I'm so glad for you. what a result on all levels.

  4. Wow! That's amazing. Congratulations! I've never actually owned a house, but that's significant savings. My closest 'refinance' was on a couple of CCs that I jiggled around and cleared. It meant borrowing from a Canadian account I still have (kind of fortunately in this case), but clears an almost 30% card to 0%. I consider that a win of sorts. Best of luck with paying the house off! xx