Nothing like waiting until the last day of the year to do something BIG.
We are doing a refi on our mortgage! After paying 7.5% interest for the past 4 years, being underwater for awhile, and dealing with all the rest of the garbage....we are ready, willing, and able.
The short version....it is a 30 year fixed, at 4.75%, via an FHA loan. We purchased 1.685% in points, which is was a little over $3000 upfront, but we can write off on taxes later. We have decided to just bite the bullet and do a bi-weekly mortgage, which automatically will shave 7 years off the life of the loan. Additionally, FHA loans have "MPI", which is the FHA version of mortgage insurance, that will drop in 5 years. Continuing with the bi-weekly payment, and continuing to pay the monthly rate ($1510), even after the MPI drops, will shave another 3 years off the term. Add in any extra we will throw at it once the rest of the baby steps are done, and we will be in good shape.
The net difference on a monthly basis is $200 back in our pocket, which will be great for the ole snowball. The month off of paying the mortgage and the escrow amount we will get will pay off CC1 (which is not $490 higher due to the appraisal cost), and my student loan snowball . The left over will go towards the car, which is our next victim in the debt snowball.
We have been working with an incredible guy, who has not only been informative and helpful, but SUPER nice. He really knows his stuff. He has laid it all on the table, walked us through everything, and really has been professional. We were pre-approved on the front end, so we have already gone through underwriting. As of right now, we will close about January 15.
We are feeling very good about this. We weighed it all out, and I think this kick will really help us in 2011. Student Loan #2 and the car will be paid off. The extra $200 (well...we look at it as $150 once the life insurance piece is worked in) will all go to debt. My other student loan payment will increase later this year, but we are prepared.
January will be our 13th wedding anniversary. Lucky 13!! This year will be huge for us in resolving some of this mess. Our little tiny snowball is starting to take shape.
I will be back tomorrow in 2011, with my new goals to share. For tonight, G-man are ordering dinner in (our last for awhile...we are doing a No Eating Out challenge in January) and watching movies.
From our house to yours.....be safe, be well, and have a wonderful New Year's Eve!!! See ya next year.