Mortgage rates further explained
Yahoo Finance has nice article entitled
A Fed Rate Cut Could Send Your Mortgage Rate Even Higher
that seems to correlate with my earlier analysis that now is a good time to get a refinance on our loan. Interest rates may get better in the future but inflationary fears will likely drive the long-term interest rates higher.
Since we’ll be looking for a 30-year mortgage, that’s what we’re interested in.
As a side note, this may seems like a repeat of our mistakes with our car as we refinanced that as well. In fact, the over all goal is the same. Reduce monthly payments and reduce overall interest payed. I think that this is still the right choice though because we are in a in a long-term effort to pay off all debt except for our house loan and I don’t currently plan to pre-pay my mortgage. Also, a house is a much longer-term than a car. We’ll essentially be extending our “overall mortgage time” to 31.5 years, but we’ll be paying less interest overall.
JD over at Get Rich Slowly has a great article on whether to pre-pay or not. His conclusion: Do whatever works best for you, but it seems it may be wisest to invest in an index fund. I think this is the way we’ll go once we get our stupid debt payed off.
Are you pre-paying or investing? Do you have any advice on what has worked better for you? I’d love to hear your Honk on this. Am I putting my foot into something I don’t want to step in?
