So now apparently I’m some kind of financial genius. Who knew?
Note that “some kind” covers a lot of ground, not all of it the sort of terrain that would inspire others to trust me with their money. But there you have it.
When we bought our home in 1996 the best mortgage we could get was an adjustable rate that started at 7.5% and went up from there. We locked it in at the first available opportunity – 8% - and just dealt with it.
In 2003 we refinanced. It took the interest rate down to 5.5%, which meant that for the same payment each month we could cash out enough money to pay for a new roof and some other much needed but smaller repairs (do you know how hard it is to find flashing in just that shade of maroon? What were the previous owners thinking?). We felt clever.
One of the benefits of our crashing economy these days is that it seems to have driven interest rates down even further. Every few months for the last several years we have received Fabulous New Offers of financial assistance! Look at these rates! Think of the money! Think of the children!
Mostly I ignored them. We were doing fine with the arrangement we had, and since I am a natural rut-seeker and my general approach to finances is “try to spend less than you earn,” that seemed sufficient.
But Kim is an optimizer. Nothing is ever “good enough.” Things always can be better, faster, more efficient, more powerful, more … whatever. This goes for work-related issues. It goes for home-related issues. I try not to think about how it applies to me personally. And it certainly applies to finances. At some point soon, for example, we will no doubt be switching banks to get away from our newly taken-over megabank and toward something that might conceivably be happy with handling our money without suctioning it all away in random fees. This will no doubt be a better situation, but one that grates on my rut-seeking tendencies.
So when our mortgage company sent us a new offer – no points, no closing costs, about 1/3 less interest – we had to look into it.
Or, rather, I had to look into it.
Because the irony of our lives is that while Kim is the optimizer and the one who has an actual clue about finances, I am the one with the more flexible schedule and the time to make those phone calls. This general set-up often leads to a lot of asynchronous ventriloquism (“What should I say when I call?”) but this time it seemed to work.
I ended up speaking to a pleasant guy at the mortgage company who went through all of the options. We settled on a 15-year fixed rate mortgage that would leave our current payments roughly unchanged, which meant that a) I didn’t have to rejigger any of my monthly budgeting, and b) since we usually try to chip in extra principal every month, if we continued to do that at the same rate we’ve been doing we’d be paid off in a bit under eight years, or roughly the time that our children would be hitting college and we would be needing a new mortgage.
From there I got shifted over to another pleasant guy somewhere in the deep South who guided me through the process. It took me a while to figure out where they were making their money off the deal – of course they’re making money off this deal; why would they offer it otherwise? – but once that was clear I felt better about it. I like it when people are up front about their agendas. Eventually a thick packet arrived in the mail last week for review, notarization and signatures. We sent it back, duly reviewed, signed and notarized.
And now we have a new mortgage.
It is a brave new world.