what if VA WONT let me do a 15 year. ive asked for it multiple times , from 2 different lenders. im having to make double triple payments to make it a 15 year but im tired of making manual payments the auto payments are a option, im just hoping they work
If the VA is the only option you are will to or can go through then you have to play by their rules. Your method will pay it down faster but won’t gain the lower interest rate. Just keep at it! Or find another remortgage lender to refi through.
While I get the point you are making, not everyone has “extra money” to throw at their mortgage. A refinance can lower their rate, lower their terms, and roughly keep their payments in the same ballpark. If you have extra money laying around then yes, you can pay extra, but that’s not quite the same thing. I would have to do the math on how much extra I would have to pay a month to save ~$60K by just paying extra to the mortgage.
@@gortmanmade7277 The point of the video is refinancing from 30 to15. “Extra money” is a given in that scenario. If you refinance from 30 to another 30, you may pay less, but it’s a TERRIBLE idea in most cases. Not only do you absorb more closing costs, but you restart the interest clock. It’ll take another 10 years or so to begin paying down any meaningful principal.
@@STELLASCUTENESS Did you hear the part of the video where I reference you do not want to do this if your interest/PMI savings don’t recoup your closing closes within 2 years not to do it? I don’t get your interest clock reference, I saved 2% interest on my loan and break even on my closing cost in 12 months. Absolutely makes sense, and again, would make zero sense to go 30 year to 30 year if you only save a very small percentage. If you can save 2% over 30 years, and you go to another 30 year, even with savings like that, is absolutely worth it. It’s all about how much you save monthly by refinancing.
@@gortmanmade7277 Look at an amortization schedule. Anyone who has been paying down their mortgage for 10 years or so has no need no business refinancing for a couple of points difference. You restart the amortization schedule, pay tons of interest for the first 10-15 years, and never really pay down your principal with speed until the second half of the loan. Starting another 30 year clock when you’re several years or more into an existing loan is a nightmare scenario.
@@STELLASCUTENESS Agreed. I would never recommend extending the terms of your loan in a refi. If you have a 30 year and have paid off 5 of it, don’t go back into a 30 in a refi. But still, to say you shouldn’t refi to save 2% interest over the next 25 years is absolutely wrong and in no way would you be spending more, even if you restart the interest clock, restarting a interest clock at 2% less still saves you a ton of money over 25 years. And as mentioned in the video, if you only save 1% interest, probably not worth it with closing costs. Very situational I know, but it all comes down to the math.
100% Not a good idea to add debt to your mortgage to upgrade your house. Rarely is the “upgrade” adding value at the level of cost associated with it. And hear me out, I’m not saying don’t upgrade your house, I’m saying don’t refinance to borrow more money and owe more money because you can’t be disciplined and patient enough to save and pay cash for upgrades. The goal is to get completely out of debt, never to add more because you just needed that kitchen remodel. Hope that helps! (Dave agrees on this topic as well, look up some videos on “cash out refi Dave Ramsey”
Appreciate the info. Only thing not explained is the vastly lower interest rate for a 15 year compared to 30. Also with housing prices skyrocketing EVERYONE with an existing mortgage shouldn’t be paying PMI.
True and true. 15 year always better because it’s half the risk for the bank. And also quite true for PMI. Most banks have some paperwork you can do to get it cleared.
@@gortmanmade7277 thankfully my wife is a manager at our lender bank branch. So we will be using the PMI savings to overpay on our mortgage payments. Why re-fi with closing costs if you can just make larger payments on the current loan?
Totally made sense. I love that you put the equation up. My loan officer is only offering me a .5 percentage reduction plus $6989 in closing cost. I owe $175000 and they were offering me $200000 cash out on a 30 year loan. My mortgage payment will only go down about $100. I am going to pass and keep shopping. Thank you so much.
So glad I could be of help to you! And you are king a wise decision. You would be putting yourself in an over 5 year hole to break even on closing costs that high. Definitely not worth the trouble.
Did your property taxes go up after the refi. Why would they increase? Property taxes are based on the value of the house. What does that have to do with refinancing?
Thanks! So my loan is through a local bank, First Bank and Trust here in Virginia. Dropping from 4% to 2.125% (basically two percent haha) I don’t know all the inner and outer workings of the mortgage market, but I assume, with our massive debt payoff, my credit score of 729 and my wife’s score of 770 helped out a lot.
His interest rate was also based on a 20 year mortgage at pre-2021 interest rates. Moving it to a 15 year lowered the rates and the FED helped to lower it even more to 2.125.
It depends on how much your PMI is saving you by being dropped. Add the interest savings per month plus the PMI savings per month and take that total and do Closing costs divided by that dollar amount of savings from the .5% interest savings and PMI savings combine. Ideally you want to keep that below 24 months to break even on those closing costs.
With that said, You must have an veryyy high monthly mortgage payment to be saving $350-$400 a month. My PMI was only like $70 a month. I doubt you will be saving that much.
@@Bluechulappa Without knowing how much money the .5% of interest will save you per month it would be hard to figure out. Add your PMI to your monthly savings with the new interest rate and divide your closing costs by that number. That should be less than 24 months break even ideally.
I don't understand how to do the calculations? Maybe you can help me I just refinanced. I was at a 4.99% interest rate after refinancing my interest rate is 2.625%. My loan amount was 138k closing cost where 6600. My old mortgage and my new mortgage we're both 30 years. Appreciate the help thank you
Alright! Let's do this. What is the difference between your old mortgage payment with the 4.99% loan compared to your new mortgage payment with the new 2.625% interest?
@@n64thebest82 So, your break even point is 33 months from now or 2 Years 9 Months. Not the best, but, if you are well planted and plan on staying there long term, it will be worth it in the long run because everything after that 2.75 years is icing on the cake and money saved. But it’s going to take you that full time just to get back to what you owed before the refi. You ideally want to keep the refi break even around two years or less. If you pay more to principle, you can cut down that break even time really fast!
It also depends on how much more time is left on your mortgage. You can also take out 25 and 20 years loans besides the 15 year. If you haven’t paid much into that initial 30 year loan then it makes sense for you to refinance and go for a little shorter term. Doesn’t have to be 15 years. Anything shorter is going to save money .
My first saving with you it’s about 1500$ that’s the interest I have to pay during my monthly payment .. when I pay off my first stupid personal loan I saved 1500$ .. Thank You so much sir
Ummmm. Really great detail. I need financials dumbed down. If I didn’t I wouldn’t be watching these videos. So thank you for keeping me on the same page as you talk.
Imagine yourself as an investor. You want higher interest payments over a longer period of time (30 year mortgage). Therefore shorter term mortgage (15 year) has smaller interest because they are less desirable. Your payments might be higher but you own the property quicker with less money out of pocket in interest. The only factor to consider in a re-fi is the time it takes to re-coop your closing cost losses.
Dave Ramsey is great for people who make a sizable income. If you make 40,000 or lower annually you’re literally living check to check and simply can’t save anything significant.
I respectfully disagree. I actually believe that his principles matter most to those in lower income brackets because they have to manage funds at a higher level to “make it by”. To say that “get out of debt so you don’t throw away your money” or “refinance to save money on your mortgage” is only for people with a lot money is missing the entire point of why you should manage your money well so you can keep more of it. Hope my viewpoint makes sense. Thanks for watching!
what if VA WONT let me do a 15 year. ive asked for it multiple times , from 2 different lenders. im having to make double triple payments to make it a 15 year but im tired of making manual payments the auto payments are a option, im just hoping they work
If the VA is the only option you are will to or can go through then you have to play by their rules. Your method will pay it down faster but won’t gain the lower interest rate. Just keep at it! Or find another remortgage lender to refi through.
@@gortmanmade7277 thank you
@@MIKEZGAMER-g8b Absolutely!
You can do all that without refinancing. Just do the math and pay that much and close the loan soon.
While I get the point you are making, not everyone has “extra money” to throw at their mortgage. A refinance can lower their rate, lower their terms, and roughly keep their payments in the same ballpark. If you have extra money laying around then yes, you can pay extra, but that’s not quite the same thing. I would have to do the math on how much extra I would have to pay a month to save ~$60K by just paying extra to the mortgage.
@@gortmanmade7277 The point of the video is refinancing from 30 to15. “Extra money” is a given in that scenario. If you refinance from 30 to another 30, you may pay less, but it’s a TERRIBLE idea in most cases. Not only do you absorb more closing costs, but you restart the interest clock. It’ll take another 10 years or so to begin paying down any meaningful principal.
@@STELLASCUTENESS Did you hear the part of the video where I reference you do not want to do this if your interest/PMI savings don’t recoup your closing closes within 2 years not to do it? I don’t get your interest clock reference, I saved 2% interest on my loan and break even on my closing cost in 12 months. Absolutely makes sense, and again, would make zero sense to go 30 year to 30 year if you only save a very small percentage. If you can save 2% over 30 years, and you go to another 30 year, even with savings like that, is absolutely worth it. It’s all about how much you save monthly by refinancing.
@@gortmanmade7277 Look at an amortization schedule. Anyone who has been paying down their mortgage for 10 years or so has no need no business refinancing for a couple of points difference. You restart the amortization schedule, pay tons of interest for the first 10-15 years, and never really pay down your principal with speed until the second half of the loan. Starting another 30 year clock when you’re several years or more into an existing loan is a nightmare scenario.
@@STELLASCUTENESS Agreed. I would never recommend extending the terms of your loan in a refi. If you have a 30 year and have paid off 5 of it, don’t go back into a 30 in a refi. But still, to say you shouldn’t refi to save 2% interest over the next 25 years is absolutely wrong and in no way would you be spending more, even if you restart the interest clock, restarting a interest clock at 2% less still saves you a ton of money over 25 years. And as mentioned in the video, if you only save 1% interest, probably not worth it with closing costs. Very situational I know, but it all comes down to the math.
I hear many people refinance and take cash out to upgrade their homes. Do you have any information about this and whether it is a good idea or not.
100% Not a good idea to add debt to your mortgage to upgrade your house. Rarely is the “upgrade” adding value at the level of cost associated with it. And hear me out, I’m not saying don’t upgrade your house, I’m saying don’t refinance to borrow more money and owe more money because you can’t be disciplined and patient enough to save and pay cash for upgrades. The goal is to get completely out of debt, never to add more because you just needed that kitchen remodel. Hope that helps! (Dave agrees on this topic as well, look up some videos on “cash out refi Dave Ramsey”
Appreciate the info. Only thing not explained is the vastly lower interest rate for a 15 year compared to 30. Also with housing prices skyrocketing EVERYONE with an existing mortgage shouldn’t be paying PMI.
True and true. 15 year always better because it’s half the risk for the bank. And also quite true for PMI. Most banks have some paperwork you can do to get it cleared.
@@gortmanmade7277 thankfully my wife is a manager at our lender bank branch. So we will be using the PMI savings to overpay on our mortgage payments. Why re-fi with closing costs if you can just make larger payments on the current loan?
@@gortmanmade7277 you could actually make money right now on advising people how to get rid of their PMI.
Totally made sense. I love that you put the equation up.
My loan officer is only offering me a .5 percentage reduction plus $6989 in closing cost. I owe $175000 and they were offering me $200000 cash out on a 30 year loan. My mortgage payment will only go down about $100.
I am going to pass and keep shopping. Thank you so much.
So glad I could be of help to you! And you are king a wise decision. You would be putting yourself in an over 5 year hole to break even on closing costs that high. Definitely not worth the trouble.
Good job passing on that. Pre-2008 lowering monthly payments on mortgages was a great way for loan officers to fleece homeowners.
I didn’t know you had a UA-cam channel. Great content my brother. Looking forward to more great tips.
Did your property taxes go up after the refi. My house is worth alot more now, and I've heard they will go up??
Did your property taxes go up after the refi.
Why would they increase? Property taxes are based on the value of the house. What does that have to do with refinancing?
@@DavidEVogel I heard that they might go up after a refi.
Not only can you get rid of PMI with the new valuation but you can also challenge the new valuation and keep your property taxes the same.
informative stuff . but where in the hell did you get the interest rate drop of 2. from ?what bank
Thanks! So my loan is through a local bank, First Bank and Trust here in Virginia. Dropping from 4% to 2.125% (basically two percent haha) I don’t know all the inner and outer workings of the mortgage market, but I assume, with our massive debt payoff, my credit score of 729 and my wife’s score of 770 helped out a lot.
His interest rate was also based on a 20 year mortgage at pre-2021 interest rates. Moving it to a 15 year lowered the rates and the FED helped to lower it even more to 2.125.
What if your only saving about .5% in interest but are also dropping off pmi? I’m being told I could save $350-400 a month be refinancing
It depends on how much your PMI is saving you by being dropped. Add the interest savings per month plus the PMI savings per month and take that total and do Closing costs divided by that dollar amount of savings from the .5% interest savings and PMI savings combine.
Ideally you want to keep that below 24 months to break even on those closing costs.
With that said, You must have an veryyy high monthly mortgage payment to be saving $350-$400 a month. My PMI was only like $70 a month. I doubt you will be saving that much.
@@gortmanmade7277 My PMI is $158 a month
You have 10 years left on your mortgage. You refinance and now have a 20 year mortgage. How do you save money?
@@Bluechulappa Without knowing how much money the .5% of interest will save you per month it would be hard to figure out. Add your PMI to your monthly savings with the new interest rate and divide your closing costs by that number. That should be less than 24 months break even ideally.
I don't understand how to do the calculations? Maybe you can help me I just refinanced. I was at a 4.99% interest rate after refinancing my interest rate is 2.625%. My loan amount was 138k closing cost where 6600. My old mortgage and my new mortgage we're both 30 years. Appreciate the help thank you
Alright! Let's do this. What is the difference between your old mortgage payment with the 4.99% loan compared to your new mortgage payment with the new 2.625% interest?
@@gortmanmade7277 was 1145 now is 944
@@n64thebest82 So, your break even point is 33 months from now or 2 Years 9 Months. Not the best, but, if you are well planted and plan on staying there long term, it will be worth it in the long run because everything after that 2.75 years is icing on the cake and money saved. But it’s going to take you that full time just to get back to what you owed before the refi. You ideally want to keep the refi break even around two years or less. If you pay more to principle, you can cut down that break even time really fast!
So i pay $1300 a month about $350 more each month
It also depends on how much more time is left on your mortgage. You can also take out 25 and 20 years loans besides the 15 year. If you haven’t paid much into that initial 30 year loan then it makes sense for you to refinance and go for a little shorter term. Doesn’t have to be 15 years. Anything shorter is going to save money .
My first saving with you it’s about 1500$ that’s the interest I have to pay during my monthly payment .. when I pay off my first stupid personal loan I saved 1500$ .. Thank You so much sir
Absolutely! That’s quite a bit of coin to save! Haha
This helped out soooo much.
So glad it did!
Ummmm. Really great detail. I need financials dumbed down. If I didn’t I wouldn’t be watching these videos. So thank you for keeping me on the same page as you talk.
Absolutely! I know this can get pretty complex so I try my best to make it all make sense.
Imagine yourself as an investor. You want higher interest payments over a longer period of time (30 year mortgage). Therefore shorter term mortgage (15 year) has smaller interest because they are less desirable. Your payments might be higher but you own the property quicker with less money out of pocket in interest. The only factor to consider in a re-fi is the time it takes to re-coop your closing cost losses.
Dave Ramsey is great for people who make a sizable income. If you make 40,000 or lower annually you’re literally living check to check and simply can’t save anything significant.
I respectfully disagree. I actually believe that his principles matter most to those in lower income brackets because they have to manage funds at a higher level to “make it by”. To say that “get out of debt so you don’t throw away your money” or “refinance to save money on your mortgage” is only for people with a lot money is missing the entire point of why you should manage your money well so you can keep more of it. Hope my viewpoint makes sense. Thanks for watching!