My bank wants to lower my mortgage rate from 5.6 to 4.8 - Page 5 - PeachParts Mercedes-Benz Forum

Local2ED · #61 10-12-2011, 09:51 PM

Quote:

Originally Posted by 10fords

Because I am a self employed contractor. I can't force others to provide for me, while providing substandard service (nor would I want to). Funny thing is you will be wishing you were in my shoes when your masters finally succeed in killing their golden goose, because I actually provide something people want, instead of requiring by government dictate that everyone pay for my miserable existence, and piss poor performance. People like you are dependant on people like me for your survival, but I am not dependant on you for my survival, so what are you going to do when people like me refuse to prop you up anymore? You're screwed sweetheart

Nothing quite screams success like paying off your mortage on your 75th. birthday. HAHAHAHAHA

Junkman · #62 10-12-2011, 10:04 PM

Quote:

Originally Posted by chasinthesun

Oh yes ,the old ,"The offer is only good till" sales approach .Its called creating urgency by those in the sales dept.I never would buy anything under a timer ,if you want my business then dont put pressure on the time it takes me to think about my decision.

I refinanced with Wells Fargo. Same deal - no closing costs but extend to original term - 15 yrs in my case.

This is a sweet deal and you were remiss in not following up. Call them back and renegotiate. You can b *** t ** h & moan if you want but handling YOUR loan is YOUR responsibility.

I suggest paying the difference between your current payment and your new longer term lower interest rate payment into the stock market. Mine goes into an s&p 500 indexed fund. I figure I'll earn more than my 3.875 mortgage interest rate and pay thee mortgage off early.

Junkman · #63 10-12-2011, 10:31 PM

I just read through some more of the posts. The bottom line is the lower the interest rate the better. It doesn't matter what the term (time to pay off) is so long as you can make the payments. (closing costs affect APR yada yada yada - just get to the bottom line)

You may put any amount you want into an alternate investment. If the alternate earns more after tax than your interest rate, you can use the accumulation to may your mortgage off early.

I set up a simple spread sheet.

Loan
Row 1 - Inputs: Beginning Value | Annual Interest Rate |
Row 2 Monthly rate (= Annual Rate / 12)

Column 1: "Month" 1 - n (or month/year )
Column 2: Beginning value 1st row copies beginning value from above

Column 3: Interest (= +Monthly Rate * Beginning value)
Column 4 Column 2 + Column 3
Column 5 Monthly Payment (Whatever you send to the bank)
Column 6 ending value = Column 4 - column 5

Investment Set this up like the loan with beginning value ) frequently 0 and return on investment %
Column 6: Beginning Value (alternate investment
Column 7: Interest Earned (or investment return) = Beginning value * investment rate which is an input similar to interest rate for loan
Column 8: = Column 6+7

Column 9 Monthly investment dollars
Column 10: = End Value = Column 8+9
Ending value of 1 month becomes beginning value of the next month.

You can pay your mortgage off when you have more money in the investment that the balance on your mortgage.

I ignore calculations details like making investment at the beginning of the month vs end of month because I just want an idea of the cash flows. You can see the effect of increasing investment payments ie $100 / month or changing the interest rate.

I periodically input the actual mortgage balance and investment account in the row that matches the current date. This brings the hypothetical back to reality.