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I am told now is the time to RE-FI even with a prepayment penalty (unless the penalty is so big it exceeds benefits.) Why? - Because a 10/30 amortization loan can be gotten for just under 4%.
Isnt this a great percentage?
If it is a large enough savings it may well be worth the prepayment penalty.. What the rates are in ten years is irrelevant since this is amortizaion and not interest only. Can someone knowledgable reply?
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It is a great percentage, but what will the rate be when you need to refinance again in 10 years? Also, do you want to incur new closing costs every 10 years?
If you are considering a refi, I would strongly suggest a regular 30 year self-amortizing mortgage. The rate may be higher now, but you won't be playing rate roulette every decade. Unfortunately the time for qualifying for 30 year mortgages may be running out because the proprietary leases for most co-ops formed in the early 1980's expire in the 2050's. Banks may not be willing to risk lending if the underlying source of repayment funds (the PL) expires before the mortgage is paid off.
Check with your accountant or managing agent if they have any expertise in this regard and can advise you.
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