Inheritance / home refi question

Bradleyrj · 02-07-2013, 09:23 AM

Grandparents left me a little money when they passed away last year. Supposed to be getting it soon and I want to pay down on my house and refinance to get a lower interest rate.. Do I refi first then pay down a good chunk, or pay first then refi?

Darryl Buckner · 02-07-2013, 01:34 PM

I would just make a baloon payment when my payment was due, because anything above the normal monthly payment goes to principle, then refinance the lower loan amount. Most refinance promotions to lower interest rates, usually doesn't require a down payment or closing fees as long as your credit is good..

04ctd · 02-07-2013, 08:13 PM

i would go to your bank, and talk to them, and figure out when/what.

it's all speculation till you have your house appraised, and get approved for the % rate.

i financed thru my home bank, and it was MUCH easier, since they had all my finances right there.

Carlrx7 · 02-07-2013, 09:10 PM

ballon payment, but save a small bit to cover the refi fees so you dont end up financing those too.

six in one hand half a dozen in another.

-Carl

WWhittle · 02-07-2013, 10:00 PM

What's the point of the balloon payment??

I would decide how much you want to put towards the house, get everything approved through the bank for the refinance and then go from there.

You will need some of the money for bank fees, but you also need to do the math on some of your options, like buying points etc.

Also, depending on your situation, the bank may offer you better terms if you are able to pay off other debt. You may or may not have any, and that's not something to discuss here, but if you spend it on a balloon payment you won't have the option to pay down other debt.

A balloon payment is not a good choice. Once you make that payment you aren't getting it back. Get all your ducks in a row, do your long term math, and then make sure you are getting the most bang for your buck. (Pun intended) Not to mention, you could make the balloon payment and then find out the refi isn't going to work out the way you hoped.

2001hawk · 02-08-2013, 06:07 AM

Personally I don't see what a balloon payment is going to do for you. If you are going to refinance anyway then you can just refinance for the new amount. Like Wes said you may also run into the expenditures and need some of that liquidity.

02-07-2013, 09:23 AM	#1
Bradleyrj Senior Member Join Date: May 2008 Location: Myrtle Beach Posts: 2,347	Inheritance / home refi question Grandparents left me a little money when they passed away last year. Supposed to be getting it soon and I want to pay down on my house and refinance to get a lower interest rate.. Do I refi first then pay down a good chunk, or pay first then refi? __________________

02-07-2013, 01:34 PM	#2
Darryl Buckner The Top Dog Join Date: Dec 2007 Posts: 2,318	I would just make a baloon payment when my payment was due, because anything above the normal monthly payment goes to principle, then refinance the lower loan amount. Most refinance promotions to lower interest rates, usually doesn't require a down payment or closing fees as long as your credit is good.. __________________ When the people fear the government, there is tyranny. When the government fears the people, there is liberty. Thomas Jefferson

02-07-2013, 08:13 PM	#3
04ctd Senior Member Join Date: Aug 2009 Location: Ladson SC Posts: 4,388	i would go to your bank, and talk to them, and figure out when/what. it's all speculation till you have your house appraised, and get approved for the % rate. i financed thru my home bank, and it was MUCH easier, since they had all my finances right there. __________________ 1 Timothy 3:16 16 And without controversy great is the mystery of godliness: God was manifested in the flesh, Justified in the Spirit, Seen by angels, Preached among the Gentiles, Believed on in the world, Received up in glory.

02-07-2013, 09:10 PM	#4
Carlrx7 Senior Member Join Date: Apr 2010 Location: Ladson,SC Posts: 3,813	ballon payment, but save a small bit to cover the refi fees so you dont end up financing those too. six in one hand half a dozen in another. -Carl __________________ Dark Aladdin

02-07-2013, 10:00 PM	#5
WWhittle Senior Member Join Date: Apr 2008 Location: Mt. Pleasant, SC Posts: 3,899	What's the point of the balloon payment?? I would decide how much you want to put towards the house, get everything approved through the bank for the refinance and then go from there. You will need some of the money for bank fees, but you also need to do the math on some of your options, like buying points etc. Also, depending on your situation, the bank may offer you better terms if you are able to pay off other debt. You may or may not have any, and that's not something to discuss here, but if you spend it on a balloon payment you won't have the option to pay down other debt. A balloon payment is not a good choice. Once you make that payment you aren't getting it back. Get all your ducks in a row, do your long term math, and then make sure you are getting the most bang for your buck. (Pun intended) Not to mention, you could make the balloon payment and then find out the refi isn't going to work out the way you hoped. Last edited by WWhittle; 02-07-2013 at 10:03 PM.

02-08-2013, 06:07 AM	#6
2001hawk Senior Member Join Date: Aug 2010 Posts: 1,224	Personally I don't see what a balloon payment is going to do for you. If you are going to refinance anyway then you can just refinance for the new amount. Like Wes said you may also run into the expenditures and need some of that liquidity. __________________ People call me John, Jim, or Bobby.