I got a letter from my mortgage bank, Chase, today. It said as a responsible homeowner and valued customer, I meet the preliminary criteria to refinance my mortgage to a 15 year fixed rate mortgage at 5.11%. Also, they are waiving the origination fee, appraisal fee, and credit report fees.
Hotdog! How can I refuse? Well, for one thing I don't really qualify for that rate because my house is a rental, not owner-occupied. I don't know what the rate would be but my current rate is 5.8% and I doubt it would be lower than that. Also, if I didn't make any extra payments on my mortgage as it is now, I would have it paid off in less than 7 years. I suppose if I wanted to free up more cash I could refinance to a 15 year mortgage and lower my payments. There are other fees that I would have to pay too. I'm guessing that there are at least $1,000 in fees. Those could probably be added to the loan so that I wouldn't have to pay them up front.
It was nice of Chase make the offer but I think I will stick with my own plan, that is, to pay extra so that I have it paid off in less than one and a half years. The thought of dragging my mortgage on another 15 years makes me cringe.