$27K loan we now need to pay back

[dawnwes]

We were fixing up the house to sell and took out a home equity line.

Just so I don't get reamed, our house is roughly 65% paid for. We have 12 years left on our loan, 2.37%.

We really don't want to refinance, but we have decided not to move for several reasons, including financial ones.

Now we have to pay it back.

This is more of a "crud" vent than a request for advice.

Loan is at 3%.

At this time we have decided to throw $500/mo at it and pay it off over a couple of years.

[disneysteve]

we have decided to throw $500/mo at it and pay it off over a couple of years.

Well at $500/month, it will take more than a couple of years, but I'm sure you know that. That's 4-1/2 years not counting interest.

The good news is now you actually get to enjoy and benefit from the repairs and renovations you made.

Plus, after all of the decluttering you have done, you get to live in a space that is free of all of the junk you've eliminated in recent months.

[dawnwes]

Well at $500/month, it will take more than a couple of years, but I'm sure you know that. That's 4-1/2 years not counting interest.

The good news is now you actually get to enjoy and benefit from the repairs and renovations you made.

Plus, after all of the decluttering you have done, you get to live in a space that is free of all of the junk you've eliminated in recent months.

Oh, right. Originally I was thinking of $1000/mo and that would be just over 2 years. Forgot to recalculate.

I have an interview this am. I am definitely NOT thinking straight.

Unfortunately, some of the repairs were done in order to sell and not what we would have chosen, particularly the kitchen.....and I really don't like it, but I am trying to find ways to like it anyway. GRRRR....

[snafu]

You can chose to begin repayment at a lower sum and increase payments as income increases or because you decide to pay it down faster. You are very disciplined and know how much the loan costs the longer you have it.

I wonder what changes were made to your kitchen that related to selling that you dislike. Is there any low cost way to adapt it more to your satisfaction?

[dawnwes]

You can chose to begin repayment at a lower sum and increase payments as income increases or because you decide to pay it down faster. You are very disciplined and know how much the loan costs the longer you have it.

I wonder what changes were made to your kitchen that related to selling that you dislike. Is there any low cost way to adapt it more to your satisfaction?

Maybe. I would want to strip my cabinets back to their original oak and refinish them. We painted them white. I hate it. I LOVED the oak look, I don't care how 90s it is. The paint job isn't even a good one. It is chipping and yuck.

The cabinets really needed replacing, or I should say, I WANTED to replace them, but the realtor said, "Eh, just give them a fresh coat of paint and slap on new countertops." So we did. And new flooring, so the cabinets really can't be replaced at this point without destroying the countertop and part of the flooring.

I hate, hate, hate them.

[disneysteve]

Maybe. I would want to strip my cabinets back to their original oak and refinish them. We painted them white. I hate it. I LOVED the oak look, I don't care how 90s it is.

That's certainly not unreasonable and something you could either tackle on your own or have done professionally. If a relatively minor fix like that would help you love the place more, you should go for it.

[tripods68]

Just so I don't get reamed, our house is roughly 65% paid for. We have 12 years left on our loan, 2.37%.

Have you look at a 10-year refinance loan? If I were you, i'd look at this seriously, if possible...

[dawnwes]

Have you look at a 10-year refinance loan? If I were you, i'd look at this seriously, if possible...

You mean for the house?

What would that help?

[tripods68]

You mean for the house? YES

What would that help?

Roll the 27K (2nd equity loan) into the primary loan (1st) by refinancing into a 10-year mortgage. You pay off your home faster by 2 years but there is the closing cost.

[dawnwes]

Roll the 27K (2nd equity loan) into the primary loan (1st) by refinancing into a 10-year mortgage. You pay off your home faster by 2 years but there is the closing cost.

And the higher interest rate.

[Jovanny]

You can start with $500/mo and gradually increase the amount to pay off your home loan.

[tripods68]

And the higher interest rate.

That is the drawback. It depends on your FICO score. But I've seen 10-year mortgage around 2.5% - 2.90% range online with Excellent 780+ FICO (I still wonder how the heck you got 2.37% in loan?) with or without lenders fee. I'd still do it, if it makes financial sense. You are still able to pay the home early from 12 to 10 year. If you think the 40-60 basis higher interest makes the difference. It may not make sense if you factor the closing cost. But if you look length of the loan, it might be (this is the reason why I would do it).

[dawnwes]

That is the drawback. It depends on your FICO score. But I've seen 10-year mortgage around 2.5% - 2.90% range online with Excellent 780+ FICO (I still wonder how the heck you got 2.37% in loan?) with or without lenders fee. I'd still do it, if it makes financial sense. You are still able to pay the home early from 12 to 10 year. If you think the 40-60 basis higher interest makes the difference. It may not make sense if you factor the closing cost. But if you look length of the loan, it might be (this is the reason why I would do it).

Well, to me, that makes no sense. I have a 2.37% interest rate right now. I can just pay more and pay it down. I am pretty sure refinancing would have me paying more in the long run.

Anyway, just paying more each month just makes more sense.

We got 2.37% when it was at the lowest. no points. We both have FICA scores over 800. We also had no closing costs. We did have to pay $450 for an appraisal. That was our only cost.

[tripods68]

Well, to me, that makes no sense. I have a 2.37% interest rate right now. I can just pay more and pay it down. I am pretty sure refinancing would have me paying more in the long run.

Anyway, just paying more each month just makes more sense.

We got 2.37% when it was at the lowest. no points. We both have FICA scores over 800. We also had no closing costs. We did have to pay $450 for an appraisal. That was our only cost.

Just throwing the idea...


Anyway, I understand its lot easier to pay extra toward without refinancing. A difference of 2 years may not make that much difference.


We're in 15-year mortgage but paying it off in 5-7 years early on any extra $$ saved each month.

[dawnwes]

Just throwing the idea...


Anyway, I understand its lot easier to pay extra toward without refinancing. A difference of 2 years may not make that much difference.


We're in 15-year mortgage but paying it off in 5-7 years early on any extra $$ saved each month.

Yeah, I understand. I was just thinking that the overall numbers wouldn't add up to savings and it would just be better to pay more. But right now I just wan that extra amount to go away.

And we have college coming up for my middle child in 2 years......

But on a positive note, I think my interview went well yesterday, so maybe I will get a job and that will help too.