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Weekly Wins & Challenges: Mortgage Refinances & Hurricanes

Photo by Tierra Mallorca on Unsplash

I wrote previously about trying to sell my house in order to cash in on the equity gained from a rising housing market over the past couple of years. That was a financial fail, since we didn’t get our asking price, AND spent a bunch of un-FI money trying to stuff our junk into a storage unit to make the house appear as minimalist as possible, to say nothing of the time and expenses involved in preparing the house to sell. Learning experiences.

This week, I celebrated two wins, one big and one small. We pivoted in trying to sell and decided to stay put for a while, taking advantage of lower interest rates to refinance our mortgage from a 30-year with 4.375% interest to a 15-year at 3.125%. Score! I had been looking at rates all summer, but when I’d actually do inquiries with banks or those teaser mortgage advertisements that pop up from big Internet companies, I discovered the actual rates were not very impressive. They say you should be able to shave off at least a point of interest to make refinancing worthwhile, and most of my casual inquiries into mortgage rates over the summer didn’t quite get me there.

However, when I learned through a FIRE Facebook group I follow that Costco (my preferred source for low gas prices and delicious snacks) had super low rates, I looked into it a little further. Having equity in the house enabled us to get a better rate, so even if we weren’t able to cash in through selling the house, at least there the equity worked out in our favor. (It’s also good we did this now, because I have the feeling the housing market is slowing down, which would reduce our equity).

Costco actually works with several different mortgage lenders, and they have very low closing costs, including mortgage origination fees of less than $350. The whole process was also very smooth, and within a month, we were done! (I also didn’t like our current mortgage servicer, so I’m eager to see which company our loan will get resold to).

The other, smaller financial win was closing up our storage unit. We had rented it almost a year ago as a place to shove all our extra things in attempting to make our house look minimalist. This was a decision made after visiting many open houses over the years and realizing that overstuffed closets and garages make potential buyers nervous that you won’t have enough space for them to store all their junk. So, the fail is that all our stuff is coming back into the garage, but at least we are saving the $100 per month we were paying on the storage unit. And I do intend to go through each and every box to figure out if we really need what’s in there, since there are some things I’ve found myself missing, but mostly I can’t even remember what’s in those boxes.

Two challenges we’re now facing, again big and small: Hurricane Dorian, which is headed for Florida, although we’re not exactly sure where it will land, and a broken washing machine that suddenly started beeping and spitting out error codes. I am extremely lucky to have a husband who can fix many things, however, so I’m keeping my fingers crossed that as we settle into our hurricane holiday weekend, he’ll be able to figure out what’s wrong with it, in time to do several loads of mounting laundry before the power goes out. And, if we do have power, I also signed up for a free trial of the You Need A Budget app (YNAB), which many people in the FIRE community swear by, so, assuming we have power for some of the time, that will be my next little financial project.

You win some, you lose some…

Published inFinancial Independence

2 Comments

  1. Ana Ana

    You definitely win some lose some! I’ve had my share of real estate ups and down. I don’t seem to time the selling part too well. I think refinancing to a 15 yr mortgage will work really well in paying down your loan. At least it did for me. I discovered the payments weren’t that much higher and the interest saved was significant.

    I’m in Florida too (Jacksonville) and we’re already tired of the hurricane talk. I hope we’re both spared and can enjoy our weekend!

    • misFIRE misFIRE

      I’m glad the 15-year mortgage seems like it might be a good option for paying the mortgage down more quickly, I’m excited just because 30 years sounded like forever… Here’s hoping this hurricane is not too terrible, although it is moving so slowly! We’re inland, so less exposed than Jacksonville, but still… we’ve still seen them do a lot of damage.

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