On a whim, Sam & I were presented with an opportunity to refinance our home we've had for just over a year. We'd been thinking it would be nice to lock into a lower interest rate, but thought that with all the extra closing costs that come with refinances it wouldn't be worth it at this time. That's when our awesome loan consultant, Conrad, called and offered us a deal we couldn't say no to.
This new offer is for a Traditional 30-Year Fixed loan at a lower interest rate. The closing costs are being capped at $2,500 (which is less than half what they normally cost) and they're just adding that on to our loan, so no extra out-of-pocket costs to us. The big benefit to us is that we'll be going from an Interest-Only loan to the Traditional 30-Year Fixed loan. The way I understand it is that we'll now be paying towards principle AND interest, instead of just our interest only. (We originally went with an Interest-Only loan because it saved us money in payments, but with this new deal, the payments will be lower due to the interest rates being lower -- good news all around!) Overall, we'll be saving a lot in interest in the long run and that sounds good to us!
Although we're not going to see a huge difference in payments, we will be saving about $40 a month, which can add up. Hopefully we'll stick to our budget & be able to pay off our pesky credit cards A.S.A.P.!
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