They should teach this stuff in school.
I'm currently 18 months into a 30yr. 5.25% (yikes) FHA loan with $211,xxx remaining. We received a grant to help with a down payment that I can't find the paperwork on. From what I remember, if we moved (or I guess, refinance) within 3 years or so, we would have to pay back the prorated difference.
- With prorated grant: $217,200
- New rate: Conventional 30yr @ 2.875%
- Total loan costs: $3,380
- Total closing costs: $4,806
Bringing us to a new loan @ $222,000.
If I'm doing my math right, our break-even would be roughly ~19 months. We want to move within 2-3 years.
At a first glance, the new rate obviously seems like a no-brainer. But I feel like I'm missing something. Am I screwing myself by financing $11,000 more than my current balance? Losing potential equity because I'll be paying more in interest (again) because that's how amortization schedules work?
Submitted December 08, 2020 at 11:46PM by Division2226 https://ift.tt/36W361O
