Paying Less For My Mortgage

[AJ]

One would think that is a good thing, but I I knew right away why..... property tax estimate went down, home value is down (heading further south), I'm gonna be in this townhome forever. Goodbye 10 year plan.

[Leroy]

Does that make this a good time to refinance?

Not that I'm complaining, we probably couldn't do too much better on our interest rate.

[cardinalkarp]

I would think its a good time to refinance (since they just dropped it another 1/2 point) as long as your credit is good enough.

I'm not sure if there are any rules to how soon you can refinance but I may give it a try here soon.

[Popeye_Card]

I would think its a good time to refinance (since they just dropped it another 1/2 point) as long as your credit is good enough.

I'm not sure if there are any rules to how soon you can refinance but I may give it a try here soon.

Part of me wants to refinance.

Another part of me makes me think I should sell my current house (which I would likely see a profit on), and go with a much smaller/cheaper condo for the next few years to wait out a recession if it comes. If I got a great rate on a 15-year loan for a smaller place, I could probably pay it off in 5 years and have no mortgage.

I like the house I have, but it's also 1500 sq. ft. for 1 person. Not really needed, just wanted.

[Hungary Jack]

One would think that is a good thing, but I I knew right away why..... property tax estimate went down, home value is down (heading further south), I'm gonna be in this townhome forever. Goodbye 10 year plan.

Where do you live? How often is your property re-appraised by the taxing authority?

[docellis]

Part of me wants to get the line of credit on the appraised value of my home now because I *think* values will decrease. So even if I never use the line of credit, the option to tap into money that may cease to be available...I don't know.

[Popeye_Card]

Part of me wants to get the line of credit on the appraised value of my home now because I *think* values will decrease. So even if I never use the line of credit, the option to tap into money that may cease to be available...I don't know.

How do lines of credit work? Do you still pay interest on that amount? Would they reduce your line of credit if your house value went down substantially?

So far the St. Louis market has been just fine for the most part. But I do fear if a recession hits it won't be. I hope I don't have to move for a while.

[planet planet]

Part of me wants to get the line of credit on the appraised value of my home now because I *think* values will decrease. So even if I never use the line of credit, the option to tap into money that may cease to be available...I don't know.

How do lines of credit work? Do you still pay interest on that amount? Would they reduce your line of credit if your house value went down substantially?

So far the St. Louis market has been just fine for the most part. But I do fear if a recession hits it won't be. I hope I don't have to move for a while.

I'm pretty sure you get approved for an amount (like credit cards) based upon when you applied for it and that ceiling doesn't change. You don't pay interest until you actually use it and then it's usually a little higher than a traditional mortgage, but shorter term (like ten years).

[sighyoung]

Part of me wants to get the line of credit on the appraised value of my home now because I *think* values will decrease. So even if I never use the line of credit, the option to tap into money that may cease to be available...I don't know.

How do lines of credit work? Do you still pay interest on that amount? Would they reduce your line of credit if your house value went down substantially?

So far the St. Louis market has been just fine for the most part. But I do fear if a recession hits it won't be. I hope I don't have to move for a while.

I'm pretty sure you get approved for an amount (like credit cards) based upon when you applied for it and that ceiling doesn't change. You don't pay interest until you actually use it and then it's usually a little higher than a traditional mortgage, but shorter term (like ten years).

planet's right--the line amount is based on the equity you have in your home at the time the line of credit is established. While you don't pay interest until you actually use it, you sometimes have to pay a nominal annual fee (say, $20) to keep the line open each year.

Right now, I'm debating either 1) refinancing my equity line, or 2) refinancing my mortgage, and rolling the equity line and mortgage into one loan and payment. I'm not sure about this--my mortgage interest rate is low, but combining the two would free up money in the short term. However, refinancing will temporarily lower my credit rating (which is excellent), and there's a possibility that I may need to replace my older car in a year or two.

Also, with state budget cuts, my salary is likely to take a big hit beginning in the fall.

[Popeye_Card]

My issues are...

1.) I have a slightly higher rate on my mortgage right now, because I didn't put 20% down, and the PMI is rolled into the rate. We did the calcs with paying PMI, taking the higher rate, or putting 20% down and paying a lower rate, and the higher rate came out on top over 5 years.

2.) My house's appraised value is likely ~110-120% of what my mortgage is for at this point. So if I refinanced, if the loan is for only 80% of the home's value, would I not have to pay PMI then?

3.) As I said above, my house really has more space than what I "need", though I do really like what I have, and I have some projects that I'd really like to get done before I move on (new bath, new kitchen, landscaping, finish the basement, etc.) that would substantially increase the value of the home (though it would be razor thin margins with the cost of the work, though I'd be doing all the labor myself). Anyway, I don't know if it's a good time to sell my house while the market is still "warm" in St. Louis, and downsize to something smaller, and get a good rate on a cheaper loan that I could get paid off in no time. Then move on to a bigger house if the market is still down--get in at a good price.

4.) I'd like to be in StL long-term, but at the same time, I don't know if that's competely realistic. There's an decent chance my company would want to move me to Denver in the upcoming years, and I don't know if I'd want to pass up that opportunity. (You know, to hang out with Radbird and all.) So I don't know if I should be doing too much stuff with playing the market here if I'm not going to be here that long.