We are refinancing -- Woo Hoo and Boo Hoo.
Woo Hoo to the 4.5% 30-year fixed rate with zero points! A savings of $400 per month with a closing cost break-even point of only 15 months ... truly incredible!
Boo Hoo to the sea of paperwork we have to complete. Good googly-moogly -- I'm surprised Dan and I don't have to get fingerprinted and give samples of bodily fluids for analysis.
Nah ... they won't need the bodily fluids since we sign the contract in blood.
I guess we're pretty lucky to understand what all the legal wording means and how it affects us ... origination points, discount points, free throw points ... I can see how people get really lost in translation. Especially if they don't know "The Fact".
"The Fact": With all transactions like home or car buying, there is little transparency for a purpose: to screw the buyer to the fullest extent.
How many poor suckers pay $200 in 'administrative fees' or pay for a 'mortgage lock fee' on closing costs? Uhhh, not us because it is a total garbage fee that you can get waived (or at least lowered) if you are savvy enough to point out the bogus charge to your broker.
So ... what are we going to do with the extra cash each month?
Save it and invest it in all of our "letter and number accounts" like 401K, 403B, 529, IRA, etc... in other words, not spend it.
Dan and I differ on this decision.
Since the economy went BANG-BOOM-BUST, we have been more frugal with our funds. Less spending, more savings.
Dan thinks we should spend like we have always spent, and this extra money every month would be not different. He sees our change in spending habits as one of the problems keeping the economy in the crapper -- if we don't spend, we can't recover.
I'm so not a risk taker. My philosophy is save it in case we need it. Now, I still hit the Target dollar bins every week, and everyone know my obsession with finding kick-butt clothes on clearance for the boys. But, I am more cautious to wait on the bigger ticket items. What if Dan or I loose our jobs? I think we need to be conservative. (Yes, I am a conservative ... but a fiscal conservative, not a compassionate conservative.)
Since I do the budget, balance the books, pay the bills, do the shopping, etc, Dan has deferred to me on this decision.
I hope we are doing the right thing. I'd hate for my no longer buying a Starbucks each morning be the reasons for the recession turning into a depression.