Should I refinance the first mortgage with the second mortgage?
I have a first and second mortgage. My first mortgage is financed at 5% and my second is at 9%.. I am considering financing both mortgages with a 2.75 rate and a 15 fixed term. The goal is to pay off the loan in 10 years by applying additional principal. My first thought was to only refinance the first at 2.75 and keep the second and pay the second off by applying additional principal and pay it off in three years. However, I was advised that it would be more beneficial if i roll both mortgages together. By doing this, I would benefit with more being applied against the principal. As my debt decrease, my principal will increase which will eventually be the goal to make one month's payment which will be principal only. . Any suggestions? by integritymbs112 from Ashburn, Virginia. Jun 26th 2020
Scott Kinne (Skinne)
#27 ranked lender in Virginia - 74 contributions
If combining two loans, and the 2nd was not taken out at time of purchase, then it will be considered a Cash Out Refinance, which can have a slightly higher rate depending on the amount of equity you have in the house. Assuming you have a good amount of equity, I believe rolling both loans together to eliminate the 9% 2nd trust is going to be much better, but I WOULD NOT TAKE A 15 YEAR MORTGAGE! There are better ways to Pay your loan off earlier and lower your effective interest rate, but will also provide you Flexibility! Call me and I will be happy to explain. Scott Kinne - VP - First Heritage Mortgage NMLS ID# 182351 571-237-6241. Fairfax VA
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