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Hi. I am an empty nester considering to downsize. Is it prudent to refinance into a 15 or 20 yr loan at this time?

I live in California and My husband will be 55 in 5 years time and was thinking that would be a good time to downsize and move into an adult community. My house is about 3300+ sq ft with only 2 people living in it. Currently on a 30 year term, thanks, by Analizacaridad101 from Sacramento, California. Jan 28th 2020 Reply

Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 4,703 contributions

Generally speaking, because all mortgage loans have closing costs, it usually makes little sense to refinance only if you will hold the new loan for at least 3-years. So if you refinance, then sell and downsize it a year, you probably didn't get ahead and actually lost money because of closing costs. On the other hand, not refinancing today, and not downsizing for 12-years (retire at 62), then you made a gigantic mistake by not refinancing today. Therefore I usually suggest that unless you know 100% for sure of selling in less than two years, that it is probably wise to refinance now. I lend in MN, WI, IA, SD, and ND. Reach me at NMLS 274132

Jan 29th 2020
John Burke (jburke)
#29 ranked lender in Texas - 293 contributions

Hi Ana,The truth is this. You do not need to refinance to accomplish your goal. You can save yourself thousands of dollars in refinance costs by simply making an extra payment every month to your mortgage. The other benefit to doing it this way is you still have the flexibility to stick with your lower, 30 year payment if money gets tight for a month or 2.| John Burke | Senior Mortgage Banker | Lending in ALL 50 states |Great Plains Bank | | (877)228-9069 | NMLS# 787231 |

Feb 13th 2020
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