Update: I've gotten my answer. I was missing a key piece of how this works. Thank you
I'm 8 years in to my mortgage. I have always put an extra $6000 a year toward principal. When thinking about the future and my emergency fund, I am in talks to recast my mortgage. My extended family has had a lot of emergencies over the last few years that required people to leave jobs to provide care. My parents are officially elderly. I figured in case of emergency or job loss, it might be a good idea to do this.
The bank gave me an estimate that my payment would drop from $1100 to $600. So, my emergency fund would go farther if I ever got to that point. However, I plan to keep paying the equivalent of the $1100 amount and the extra principal payments.
Am I completely wrong in how I'm thinking about this?
ETA: 4.37% interest rate and my goal is still to own the home outright as fast as possible
ETA 2: I have a 12 month emergency fund. I max out my IRA and am close on my 401(k). I have about $90K left on the mortgage.
Submitted December 04, 2023 at 10:34PM by IronicSunshine83 https://ift.tt/c2JYNSB
