• Refinancing

    For those new to the blog, I used to write under the pseudonym “The Incidental Economist” on the personal finance website “The Finance Buff,” hosted by TFB. He’s still my favorite personal finance blogger, having proven to me again and again that he’s smart, knowledgeable, sensible, and trustworthy.

    He recently tipped me off to the prevailing low mortgage rates. I stopped watching them a few years ago after I refinanced down to 4.75%. I figured rates couldn’t possibly go low enough to justify refinancing yet again. My criteria are that I save at least $100/month and pay off any closing costs within two years. To my surprise, these thresholds were met at rates available a month or so ago.

    Today, thanks to TFB, I just closed on a new, 4.25% loan. That means, in the decade I’ve been a home owner, my interest rate has been cut in half. That’s amazing. In my refinance, I used the same bank and had a similar experience in doing so as he did (see his post on this).

    I’m aware the low interest rates are due to decisions by policymakers that have many other implications. I’m not going to go there (feel free in the comments). Just saying: (1) Read TFB. He could save you some money. (2) Home mortgage interest rates are insanely low.

    • This makes me feel very good about the 4% fixed rate mortgage we negotiated about 6 years ago. I love it when refinanciers call and try to offer me a HIGHER rate!

    • We are signing ours for 3.875% on Friday. It has been a different experience. They came and took pictures of every room in our house, which has never happened before. We had to send in two photo IDs each from my wife and myself. I was told this was a Patriot Act requirement.