Basically my situation is that I got approved for a loan at the beginning of December 2018 with an interest rate of 4.75% and bought a house that I closed on at the end of 2018, have a $300K 30 year fixed rate mortgage. when I bought the house, the 4.75% seemed like a fair rate and it seemed like interest rates were going to keep rising. But now I'm reading that interest rates actually have dramatically dropped over the last couple of months and have hit 4% again. I'm sort of feeling like I bought at a terrible time and entirely got screwed on my loan because if I had waited a couple of months my interest rate would be dramatically lower. My question is when is re-financing really worth it? There's a lot to consider... I get that if I re-financed that I would have to pay like $10K in closing costs again... which I already just paid. But it's also $48K less that I would pay over the 30 year life of the loan if I were to refinance. But I also get if I just took that $10K and put it in the market and let time value of money take care of it, that $10K would be worth more than that $48K ($38K net after paying $10K) I'd save by refinancing.
I think one thing that I can take solace in though is that I believe the mortgage interest deduction helps to make this somewhat of a moot point, because even if I'm overpaying in interest, I'm still able to deduct 100% of it and have it reduce my tax liability... so maybe net it doesn't really make a difference? For all of these reasons, I'm leaning towards not refinancing, but just wanted to make sure that I wasn't missing any considerations or just rationalizing this in a way to make myself feel better.
Submitted March 30, 2019 at 09:55PM by howdumbmi123 https://ift.tt/2uCKY93
