Hi! My parents are 61 and 66 y.o. & are wondering if refinancing their mortgage is a good idea. They currently have a loan balance of about $177K for their home which, at most recent estimate, is valued at about $280K (so NOT underwater.) They live in a highly desired area north of Chgo. Mortgage is at 5.1% and they are paying $1800 month, a little over the minimum. One parent retired, the other still works (61 y.o.) The older parent who retired is not collecting Social Security yet so they are doing OK with the one income. Thanks, what do you think?
Terry Says: I definitely think they should try to refinance — probably to a 15 year mortgage. They’ll get a much lower rate, so they can probably pay off the loan sooner and save a lot of interest, without increasing the monthly payment. BUT — and this is a big but — since one of them is retired, they may not have enough income to qualify for a new mortgage! The best way to find out is to try. Go online to www.GuaranteedRate.com and go through the process and see what happens!