To Re-mortgage or not to Re-mortgage, that is the question!

Recently I ran across some clients who were weighing out the benefits of refinancing their existing mortgage. They had arranged a mortgage approximately a year ago with a 5 year term, 40 year amortization at an interest rate of 5.99%. I showed them that if they were to refinance for the same 40 year term with a new rate of 4.49% for 5 years they would save $368.06 per month on their payments, this would account for a total savings over 5 years of $22,083.60. However what I suggested that they do is keep the payments the same as I knew that like most people they would spend the savings elsewhere instead of banking it, and they were comfortable with their currently monthly payments anyway. I showed them that if they were to reduce their amortization however to 25 years they would now have approximately the same payments, but have taken 15 years off their mortgage plus save approximately $30,494.73. Even after allowing for a pre-payment penalty of $15,000.00 and other costs associated with re-mortgaging they were still saving an amazing $14,494.73!

Call me today at 250-686-4246 or e-mail to discuss your personal situation!