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How much have you saved from your mortgage refinance?

Posted: Tue Nov 10, 2020 9:07 pm
by dropdx
I'm curious to see how much people have saved from their mortgage refinance since a lot of people have refinanced recently.

I originally had a 30 year @ 3.825%, but refinanced to no-cost 30 year @ 3.125% with LenderFi back in March and I also got rid of my PMI, no appraisal, and I actually received a $400 refund at closing (paid to refinance), and then last month I refinanced again with LenderFi to a no-cost 30 year @ 2.875% and also removed my escrow account.

So, my 3.825% original principal payment + PMI was $1,293 - and now my principal payment is $1,042 - a difference of $250 a month or $3,000 annually!

Pretty awesome!

Re: How much have you saved from your mortgage refinance?

Posted: Tue Nov 10, 2020 10:25 pm
by runner3081
dropdx wrote: Tue Nov 10, 2020 9:07 pm I'm curious to see how much people have saved from their mortgage refinance since a lot of people have refinanced recently.

I originally had a 3.825%, but refinanced to no-cost 3.125% with LenderFi back in March and I also got rid of my PMI, no appraisal, and I actually received a $400 refund at closing (paid to refinance), and then last month I refinanced again with LenderFi to a no-cost 2.875% and also removed my escrow account.

So, my 3.825% original principal payment + PMI was $1,293 - and now my principal payment is $1,042 - a difference of $250 a month or $3,000 annually!

Pretty awesome!
Question, did you push the terms back to 30/15 years from where you were (a lesser amount)?

Re: How much have you saved from your mortgage refinance?

Posted: Tue Nov 10, 2020 11:03 pm
by matti
This summer, we refinanced a fairly new mortgage (~$129k) from 3.25% to 2.85% (or something similar, as I recall). We save ~$100/month.

Re: How much have you saved from your mortgage refinance?

Posted: Tue Nov 10, 2020 11:19 pm
by Eurookat
original loan @ 287k 30yrs at 3.75
refi loan @ 283k 20yrs at 2.75

Our monthly payment bumped up by close to $200 but over the course of the loan we stand to save almost 80k in interest. I plan on making extra payments by paying it off in 12yrs

Re: How much have you saved from your mortgage refinance?

Posted: Tue Nov 10, 2020 11:54 pm
by dropdx
runner3081 wrote: Tue Nov 10, 2020 10:25 pm
dropdx wrote: Tue Nov 10, 2020 9:07 pm I'm curious to see how much people have saved from their mortgage refinance since a lot of people have refinanced recently.

I originally had a 3.825%, but refinanced to no-cost 3.125% with LenderFi back in March and I also got rid of my PMI, no appraisal, and I actually received a $400 refund at closing (paid to refinance), and then last month I refinanced again with LenderFi to a no-cost 2.875% and also removed my escrow account.

So, my 3.825% original principal payment + PMI was $1,293 - and now my principal payment is $1,042 - a difference of $250 a month or $3,000 annually!

Pretty awesome!
Question, did you push the terms back to 30/15 years from where you were (a lesser amount)?
It remained a 30 year throughout, added that to my OP.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 12:23 am
by ripvanwinklesf
We paid down principal of $730k down to $510k, and reduced the interest rate from 4.25% to 2.5%, taking our mortgage down from $4054 per month to $2006 per month, savings of >50%!

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 12:55 am
by invest4
Original: 400k @ 3.875 = ~$1900

Current: 369k @ 2.625 = ~$1500

A bit over $400 a month. While very enthusiastic about the lower borrowing costs, it is tempered by the lower returns made on cash savings, etc.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 1:28 am
by pasadena
In order to see how much you saved, you need to compare the total cost of each mortgage. Since you reset the term to 30 years each time, your monthly payment have dropped more than just because of the rate change.

Then if you *really* want to be scientific about it, calculate how much you will make on top of it if you invest that $250 every month for whatever the term of your first mortgage was.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 1:43 am
by JBTX
dropdx wrote: Tue Nov 10, 2020 11:54 pm
runner3081 wrote: Tue Nov 10, 2020 10:25 pm
dropdx wrote: Tue Nov 10, 2020 9:07 pm I'm curious to see how much people have saved from their mortgage refinance since a lot of people have refinanced recently.

I originally had a 3.825%, but refinanced to no-cost 3.125% with LenderFi back in March and I also got rid of my PMI, no appraisal, and I actually received a $400 refund at closing (paid to refinance), and then last month I refinanced again with LenderFi to a no-cost 2.875% and also removed my escrow account.

So, my 3.825% original principal payment + PMI was $1,293 - and now my principal payment is $1,042 - a difference of $250 a month or $3,000 annually!

Pretty awesome!
Question, did you push the terms back to 30/15 years from where you were (a lesser amount)?
It remained a 30 year throughout, added that to my OP.
But if you refi a 30 year to another 30 year, you are starting the clock over, and with a lower total principle amount. Of course the payment will be lower. You are spreading the same amount of principal over more years. Your new mortgage lasts longer than your previous one.

It is a game mortgage agents will play to sell you on a refi.

I prefer to look at the interest saved, on the current principle balance, at least over the first few years.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 2:02 am
by AerialWombat
I just refinanced three loans at the end of September. Two were VA loans on rental properties. Combined, putting an extra $300/mo cash in my pocket.

On my primary, did a cash-in refi to eliminate PMI, cut rate from 4.75 to 2.75, and went from 30 to 15 years. Payment is only $70 higher, but I’ll save a boat load on interest. Enough to buy the boat, ironically.

Happy camper here!

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 2:38 am
by modest_man
Original mortgate 340,000 at 3.375% in 2016. Two years of double-mortgage payments helped whittle the principle down to 270K.

Refinancing 270K at 2.75% saves me approximately $500/month. In addition, I earned $2500 through the Better.com Amex promo.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 8:27 am
by Admiral
JBTX wrote: Wed Nov 11, 2020 1:43 am
dropdx wrote: Tue Nov 10, 2020 11:54 pm
runner3081 wrote: Tue Nov 10, 2020 10:25 pm
dropdx wrote: Tue Nov 10, 2020 9:07 pm I'm curious to see how much people have saved from their mortgage refinance since a lot of people have refinanced recently.

I originally had a 3.825%, but refinanced to no-cost 3.125% with LenderFi back in March and I also got rid of my PMI, no appraisal, and I actually received a $400 refund at closing (paid to refinance), and then last month I refinanced again with LenderFi to a no-cost 2.875% and also removed my escrow account.

So, my 3.825% original principal payment + PMI was $1,293 - and now my principal payment is $1,042 - a difference of $250 a month or $3,000 annually!

Pretty awesome!
Question, did you push the terms back to 30/15 years from where you were (a lesser amount)?
It remained a 30 year throughout, added that to my OP.
But if you refi a 30 year to another 30 year, you are starting the clock over, and with a lower total principle amount. Of course the payment will be lower. You are spreading the same amount of principal over more years. Your new mortgage lasts longer than your previous one.

It is a game mortgage agents will play to sell you on a refi.

I prefer to look at the interest saved, on the current principle balance, at least over the first few years.
+1. You may be saving monthly, but there may be no long-term savings at all, depending on the rate delta. Many people refi to shorter term which has the opposite effect: Higher monthly, significant savings overall. And equity build more quickly.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 8:31 am
by mw1739
Original mortgage was 30 year at 3.75%. Refinanced in May to a 20 year at 2.875%. Payment was roughly equal but took several years off the mortgage. Currently working on another 20 yr at 2.375% that will save roughly $100/month.

Not much savings overall but pretty good return for a couple hours work.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 8:42 am
by Jack FFR1846
When we had a mortgage, we did some similar refi's to reduce the interest rate. All of ours were no-cost refi's so we spent nothing. We did 3 in total, first reducing the rate, then going from 30 to 15 and reducing the rate again and then finally reducing the rate on a final 15. I remember the savings for our final refi, doing the same original amount mortgaged was $12 a month. After that, we dipped below $100k owed and nobody wanted anything to do with that low amount.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 8:47 am
by sschoe2
I refi'd in June from 4.25% down to 2.625% 10 years about $130k left at the time. I bought the house and got the original mortage Oct 2018 $257k. Closing costs were ~ $2k.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 9:04 am
by runner3081
dropdx wrote: Tue Nov 10, 2020 11:54 pm
runner3081 wrote: Tue Nov 10, 2020 10:25 pm
dropdx wrote: Tue Nov 10, 2020 9:07 pm I'm curious to see how much people have saved from their mortgage refinance since a lot of people have refinanced recently.

I originally had a 3.825%, but refinanced to no-cost 3.125% with LenderFi back in March and I also got rid of my PMI, no appraisal, and I actually received a $400 refund at closing (paid to refinance), and then last month I refinanced again with LenderFi to a no-cost 2.875% and also removed my escrow account.

So, my 3.825% original principal payment + PMI was $1,293 - and now my principal payment is $1,042 - a difference of $250 a month or $3,000 annually!

Pretty awesome!
Question, did you push the terms back to 30/15 years from where you were (a lesser amount)?
It remained a 30 year throughout, added that to my OP.
Right, so now your original 30-year is now a 35 or whatever.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 9:21 am
by runner23
This is probably my biggest accomplishment over the last two years. Let's see if I can recall the specifics.

11/18 - Bought 1st house at 28 y/o $508k mortgage with 20% down so no PMI. 4.625% with escrow - $3,506. (this was actually a good rate at the time).
05/19 - No cost refi to 4.125% and no escrow on $499k principle - $2,418.
08/19 - Lender allowed a loan modification without refi 3.75% - $2,309. (This is a great lesser known benefit of Ally. You just have to request it).
03/20 - No cost Lenderfi refi to 3.125% on $480k principle - $2,056.
09/20 - No cost LenderFi rate guarantee refi to 2.625 on $456k principle - $1,831.

I understand I paid down some principle along the way, kept getting 30 year refis and removed escrow, but overall savings are significant and feel much better about monthly cashflow. Hard to calculate savings with those variables. Can not see myself refi'ing again unless rates go down a lot. However, when I purchased my house in 11/18 people were saying we would never see under 5% mortgages again I feel like.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 12:07 pm
by bikesandbeers
The intesterest savings from going from a 30 year to a 15 year was much bigger the the savings from the interest rate. We also rolled in a heloc

Overall same monthly payment as old mortgage plus heloc, but everything will be paid off before the kids start college.

Calculated savings of about $50k over the life on the loan.

I am thinking about another refi get a 2.0%, but it seems like a lot of work to save something like $50/ month

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 4:10 pm
by Z3roCool
About to close on our first refi.
3/2017 - Bought our home and financed $177k @ 3.75 (30yr fixed) = $820
11/2020 - Refinanced $155k @ 2.875 (30 year fixed) = $645
Monthly savings of $175, yearly savings of $2100.

I always send $1k monthly and I do bills every two weeks, so I make an additional monthly payment of $1k a year. By my calculations, the new loan will be paid off in 15 years. Just in time to help pay for the kids' college.

It's a huge difference from when we bought our first home financed $106k @ 5.875% = $630 back in 2003.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 4:37 pm
by Admiral
Z3roCool wrote: Wed Nov 11, 2020 4:10 pm About to close on our first refi.
3/2017 - Bought our home and financed $177k @ 3.75 (30yr fixed) = $820
11/2020 - Refinanced $155k @ 2.875 (30 year fixed) = $645
Monthly savings of $175, yearly savings of $2100.

I always send $1k monthly and I do bills every two weeks, so I make an additional monthly payment of $1k a year. By my calculations, the new loan will be paid off in 15 years. Just in time to help pay for the kids' college.

It's a huge difference from when we bought our first home financed $106k @ 5.875% = $630 back in 2003.
Have you considered that:
$355 (your extra payment) per month;
plus $1,000 extra per year;

Invested for 15 years, at a modest 4% RoR and 1% inflation yields:

$108,000 (current dollars, not including tax drag)

So, in 15 years you will have eliminated a $1,000 monthly expense, freeing up 12k per year, and saved 15 years of payments (or $116,000 which buys less due to inflation), but all that money you've paid will be in home equity where you cannot access it without a loan, and with the potential loss of more than $100,000 in liquidity.

Even at 2% return, your investment would be close to 6 figures (before tax drag).

Just something to keep in mind, obv we all do what we feel is best for our situation. I would hope all tax advantaged space is maxed out if you're pre-paying on such a low interest loan.

Re: How much have you saved from your mortgage refinance?

Posted: Wed Nov 11, 2020 11:26 pm
by Z3roCool
Admiral wrote: Wed Nov 11, 2020 4:37 pm
Z3roCool wrote: Wed Nov 11, 2020 4:10 pm About to close on our first refi.
3/2017 - Bought our home and financed $177k @ 3.75 (30yr fixed) = $820
11/2020 - Refinanced $155k @ 2.875 (30 year fixed) = $645
Monthly savings of $175, yearly savings of $2100.

I always send $1k monthly and I do bills every two weeks, so I make an additional monthly payment of $1k a year. By my calculations, the new loan will be paid off in 15 years. Just in time to help pay for the kids' college.

It's a huge difference from when we bought our first home financed $106k @ 5.875% = $630 back in 2003.
Have you considered that:
$355 (your extra payment) per month;
plus $1,000 extra per year;

Invested for 15 years, at a modest 4% RoR and 1% inflation yields:

$108,000 (current dollars, not including tax drag)

So, in 15 years you will have eliminated a $1,000 monthly expense, freeing up 12k per year, and saved 15 years of payments (or $116,000 which buys less due to inflation), but all that money you've paid will be in home equity where you cannot access it without a loan, and with the potential loss of more than $100,000 in liquidity.

Even at 2% return, your investment would be close to 6 figures (before tax drag).

Just something to keep in mind, obv we all do what we feel is best for our situation. I would hope all tax advantaged space is maxed out if you're pre-paying on such a low interest loan.
You sound exactly like my brother. haha He has mentioned the above scenario a lot when we talk. My husband and I are really debt adverse and have a goal to be mortgage free. We'll def. give it more thought though since you're the 2nd person to mention it.

Re: How much have you saved from your mortgage refinance?

Posted: Thu Nov 12, 2020 2:09 am
by chuckb84
Refinanced with Lenderfi from our existing 3.75% loan to 3.0, with no closing costs. Saving about $215/month. Of course, this reset the mortgage to 30 years from 26, but the reduction in monthly payment was the main goal.

Also paid off the HELOC, so that eliminated $900/month. Enjoying the lower monthly costs!