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Personal Story about a Home Mortgage Refinancing Loan

Personal Story about a Home Mortgage Refinancing Loan Team
UpdatedDec 1, 2010

Personal Story about a Home Mortgage Refinancing Loan

When my boyfriend Ben and I graduated from college and both took jobs in our hometown, it just made sense that we would get an apartment together. Ben's parents had become like a second family to me, and while we were apartment hunting, his father suggested it might make more sense for us to buy a house. He pointed out that a house would allow us to build equity that we could borrow against later; then, he admitted that he wanted a place for Ben's little brother to live while he attended the local community college. If Ben and I agreed to let his brother live with us, Ben's dad said he would help with the closing costs and pay part of the mortgage. We jumped at the chance.

At the same time, Ben's parents were looking to scale down their home. With their youngest child beginning college, they wanted something smaller that wouldn't require as much maintenance. The very next weekend, we were all house-hunting together. It was actually a lot of fun, though it seemed everyone had a different opinion about every house we looked at. In the end, Ben and I chose a three-bedroom house close to downtown and within bicycling distance of campus, which suited his brother. Ben's parents chose a condominium a bit further out of town, but close to shopping and the local movie theater. All the steps, details and paperwork for the mortgage surprised me. I was happy when that part was over, and figured I wouldn't have to think about any of it again for quite a while.

For almost two years, I was right. Then, on my 24th birthday, Ben proposed to me. Around the same time, his brother was considering transferring to a larger university out of state. While we were still busy with wedding plans, Ben unveiled his ideas for the house. He wanted to turn his brother's old room into a nursery and

remodel and expand the kitchen and downstairs bathroom. With wedding expenses building up and the scope of Ben's remodeling plans, I knew we'd need to borrow some money to stay ahead of it all.

We researched several options, from opening up a credit card with a 0% introductory rate to taking out a second mortgage. After careful consideration, we decided on a home mortgage refinancing loan. We determined that a cash-out refinance would allow us to walk away from the closing table with enough money for our wedding and the remodeling project. I preferred the refinance instead of the credit card, because our interest rate would be locked in, and all the interest we paid on the refinance loan would be tax-deductible. It also seemed more advantageous than taking out a second mortgage, because with a cash-out refinance we would continue to have just one payment per month.

We did a lot of shopping around, comparing the rates we found online with those we received from professional loan officers. We also compared the fees and closing costs associated with each program to be sure we'd be saving the most in the long term. A couple of months later, we signed the paperwork for our home mortgage

refinancing loan. When Ben's father heard the rate we'd gotten, he decided to look into refinancing for himself.

Because Ben's parents didn't need cash for anything, their home mortgage refinancing loan would be a rate-and-term refinance. They would save money by paying a lower interest rate, and Ben's father told him they would also shorten the term of their loan in order to pay off the condo faster. I thought we had been thorough in our research, but Ben's dad took it to a whole new level, finding an offer with excellent terms and an interest rate 2.5% lower than their original mortgage.

Home mortgage refinancing loans turned out to be the answer, both for Ben and me and for his parents as well. Our cash-out refinance gave us the wedding and the house of our dreams, while my in-laws were able to save thousands of dollars in interest and pay off the mortgage on their condominium several years sooner with a rate-and-term refinance.

Ben and I joke now that his parents do everything at the same time we do, but I think our newest announcement will break that trend. Ben's about to become a father. He doesn't need any more little brothers!