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Profile picture for jaguarmom

7 years to go on a 15 yr fixed rate mortgage, refinance to 5/1 or 7/1 ARM?

Does it make sense to refinance to take advantage of the lower rates on ARM's with only 7 years to go on my 15 year fixed rate (4.87%) mortgage (and still pay off the debt in 7 years)?
  • July 19 2010 - Boulder
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Answers (5)

Profile picture for David Widlund
yeah, not worth it. No way you will make up the difference between the two rates when you factor in all of the costs, unless your loan is still over 200k.

Just get it paid off.
  • July 19 2010
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God no -- refi at a 30 year fixed. The rates are between 4.25-4.5 %. We'll probably never see this again.
  • July 19 2010
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Rates on arms are great right now. But not sure that would make sense to refinance. You would be going back to a 30 year amortization. If you have 7 years left and want to pay your home off. I'd keep your current loan.
  • July 19 2010
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At best you will save a few thousand dollars, really not worth it.  
  • July 19 2010
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Profile picture for sunnyview
No I wouldn't think so. If you're on the last 7 years of 15 you should be pretty far along on your amoritization schedule and most of your payment would be moving to principal I would think. Plus it would cost you money to refi right? You might try running some numbers on the refinance breakeven calculator here.
  • July 19 2010
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