“Nearly 5 Million Mortgages Paying Higher than necessary Interest Rates”

“Nearly 5 Million Mortgages Paying Higher than necessary Interest Rates”

 

 

 

According to the latest report from Black Knight, 4.9 million homeowners with a mortgage can now reduce their interest rate by at least 0.75% by refinancing after the recent drop in mortgage rates.

 

 

Should they all refinance? NO. Here’s the thing, you must look at the math. Just because some can save 0.75%, will the cost justify the refinance?

 

I received a call from Becky who was referred by a co-worker. She had been in her mortgage for 8 years and had 22 years remaining. She had a mortgage rate that was about 1% higher than was currently available for a 30-year mortgage.

 

When I reviewed all her numbers there was a better solution. We ended up refinancing into a 15-year mortgage and included a car loan and 2 credit cards. Her current mortgage payment was $1411, her car payment was $649 and the minimum payment on the credit cards was $316, all of which totaled $2376.

 

Her new mortgage payment was $1450, plus $699 for her escrows for a total of $2149.

 

So, looking at the math she has a monthly savings of $227. Plus, two more important benefits. Interest on her credit cards and auto loan were not tax deductible yet all the interest on the mortgage is deductible. Now the BIG benefit is that Becky will save $67,000 in interest by reducing her mortgage term by 7 years.

 

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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com

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Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.

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Comment balloon 7 commentsJoe Petrowsky • April 05 2019 02:54PM

Comments

Good morning, Joe Petrowsky good guidance here for Becky.... as you do with all of your clients....

Posted by Barbara Todaro, Marketing Agent for The Todaro Team (RE/MAX Executive Realty ) 7 months ago

I'm sure Becky will be very happy she came to you for your assistance!

Posted by Kat Palmiotti, The House Kat (406-270-3667, kat@thehousekat.com, Broker, Blackstone Realty Group - brokered by eXp Realty) 7 months ago

I am sure that you made Becky very  happy and really pleased her co-worker who referred her to you! 

Posted by Lise Howe, Assoc. Broker in DC, MD, VA and attorney in DC (Keller Williams Capital Properties) 7 months ago

I am sure that you made Becky very  happy and really pleased her co-worker who referred her to you! 

Posted by Lise Howe, Assoc. Broker in DC, MD, VA and attorney in DC (Keller Williams Capital Properties) 7 months ago

Good morning Joe. Some should refinance and some should or cannot. All should seek capable advice as to what to do! Enjoy your day!

Posted by Wayne Martin, Real Estate Broker - Retired (Wayne M Martin) 7 months ago

That's an amazing figure, Joe... I'd have thought that by now many more people would have at least explored the option of refinancing. I know I have that discussion with many of my clients on a regular basis.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Residential Brokerage ) 7 months ago

Morning Joe.

When the math works and saving 7 years of payments, it's a Win-Win

Posted by James Dray, Exceptional Agents, Outstanding Results (Fathom Realty) 7 months ago

Participate