refi mortgage

[angrymime666]

hi gents,

a little background first.

purchased property for 250k. currently can sell for under 500k atm. 92k remaining on mortgage with 2 years left in a 5year fixed @3.79.

property currently produces $1600 per month and I live for free. biweekly payment of 416. currently all expenses reach around 1500.

there are 2 options I am considering. I will be selling this house at the end of the term or before depending on market and how quickly I complete my renos.

1) refinance mortgage for a 5yr variable ( 1.15 - 1.50) and lowering my payment to 170 biweekly. now I will have cash after expenses per year of almost 8k. I will have to pay a penalty for early break of contract of probably 2-3k rolled onto the new mortgage. risk of boc raising the rates up higher. Im estimating .25% per increase.

or 2) keep the existing mortgage and break the mortgage, pay the penalty at time of sale and not have the cash flow of 8k.

I am having a sit down with the bank tomorrow to run the numbers.

whats your opinion?

 

[angrymime666]

so it looks like I will be staying and not breaking or refinancing.

breaking would cost 4k on top of remaining mortgage.

refinancing I thought would be a simple thing, yet it is not. same 4k rolled onto the back end of the mortgage which is a bit higher than anticipated but no biggie. problem is that the bank will only match another banks rates and may only beat them by .10%, which doesnt come even close to canwise offer of 1.15. another problem is that they would also base my new biweekly payment on a higher interest rate even though I would be paying prime plus the banks cut. essentially I would paying more towards the principle but not be able to extract that cash I wanted.

lesson learned never get the fixed rate; as with the variable, I would only be paying 3 months interest.

poop....