Otis McNatt wrote in message
. ..
I have a mortgage, but this is an area of life that I'm
not much up on. I heard a bit on a consumer show yesterday
about (and I think I got this right) a "no closing cost home
equity refinance." A woman caller asked about this and the host
said she should consider one; and her situation was that she only
had a principal now of about $17k, with only about 42 months
left on it, with an interest rate of 7%. He said something about
her being able to get a refi at around 4% at present, and something
about it probably staying at that level for most of the time she
had left, with it possible going up later, etc.

This got me to thinking. My situation is that I have a principal
of about $35k, with about 8½ years left (I've been paying an extra
$50/month for the past 3½ years onto the principal). My fixed rate
is 7.375%, and this was a 15-year mortgage (I made a pretty big
down payment, btw). The amount I borrowed was only $45k.
So, can some of you here enlighten me some on this? I figured it's
better to get advice from ordinary consumers and homeowners than
to start calling lenders. Heck, some of you are probably experts
on this. Thanks to anyone who wants to give useful and accurate feedback.
Should I consider looking into this?

I think you figure incorrectly. If you don't start calling lenders, you
don't know what it will cost.

We recently did a home equity refinance. What happens in essence is that
you take out a home equity loan and use the proceeds to pay off your present
mortgage. Total costs were $75 - no points, no other fees. For that, we
dropped about 2.5 years on the remaining term (from 12.5 years to 10) and
knocked a few bucks ($10-$15) off the monthly payment.

If you can't get low or no fees and closing costs (not fees and costs added
into the mortgage) and reduce the payment and/or decrease the term, it's
probably not worth it. We looked into refinancing two or three time before
this - every time the interest rate was lower than on our first mortgage,
but after fees and closing costs were added in, the total we would have paid
over the remaining term was higher than if we did nothing.