Any reason I should not Refi?

[Goldy]

I currently have a 5/1 ARM at 2.5% with 4 years left and was just offered the same loan from a different bank with no closing fees. The current loan was for 256k and now we owe 238k so the new mortgage will be slightly cheaper due to reamoritizing it over 30 years. I dont care about the mortgage payment "savings" because we will continue to make double payments to reduce the principle but I think I might do it just to push the potential adjustment out another year.

What do you guys think? To me its a bit of a no brainer to do it but I wanted to get some feedback before I pulled the trigger incase I am missing something. The only thing I can think of is that I would need to fund my escrow in full but thats kind of a wash in the end.

[kork13]

As for your proposed idea... I give a solid "meh" with an accompanying ::shrug::
What will that extra year get you? Do you expect that rates will be lower in 5 years than in 4 when it comes time for your ARM to adjust? Not likely.

Personally, I'd be looking for a fixed rate mortgage instead. And since you seem to be able to afford double payments (about $2k/mo total?), why not go with a 15 yr fixed, with rates currently at 2.75% (or lower). Sure, your P+I payment would be ~$1650/mo, but you wouldn't have to worry about what rates might be 4-5 years from now (likely higher, once the Fed finally gets out of the bond-buying business).

[grumpter]

Why would you make double payments on a 2.5% mortgage?

[Goldy]

I like your rating system.

The reason I picked a the arm is because it had the lowest interest rates and in our industry we move around fairly often so a 30yr didn't make sense. The 15yr had a slightly higher rate when we were first looking so I discredited it but if rates have dropped it might be a viable option.