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Dear TZ-30 Years is too long but I can't afford to pay more per month!

Real Estate Agent with Remax First Realty II 0790808

Dear TZ,

My wife and I have another 28 years left on our 30 year mortgage. Paying that mortgage takes every nickel we have, so we can't afford to refinance with a shorter term, and we can't afford to pay more toward the principal every month. But we're both in our forties and would like to be ready to retire in about 20 years. Retiring will be impossible with a mortgage over our heads. What can we do?

BluePrint Bill

 Money Fight

Dear Bill,

The good thing is that you have several options available to you.   What might be the best option for you would be to look into refinancing into an Adjustable Rate Mortgage.  These come in many flavors but getting into a 7/1 ARM or 5/1 ARM should give you a rate much lower than that of a 30 year mortgage.  

What does 7/1 or 5/1 mean?  It means that you get the intial (much lower rate) for the first 5 years (in a 5/1 ARM) then your rate will adjust every year after that.  The good news is that you can refinance along the way if you need to.

The first thing that you should do is talk to your mortgage rep and they will be able to give you your options.


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~ Wayne & Jean 

Union County, NJ - a great place to live and work!

If you're looking to buy or sell a property in Union County, call us at 908-917-4189 or email TeamZuhl@gmail.com.


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All opinions, information and data provided is deemed reliable but is subject to errors and omissions. Not intended to solicit other Brokers' clients. We cooperate with them fully. 

Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Wayne & Jean Marie, I always mention to my clients how long are they planning on living in their home? Then I mention about the studies that show the average person nowdays stay 5 to 7 years and they move up, down or out.... hence your advice is very good especially if the person's intrest rate is higher than 4.5%

Oct 19, 2012 07:11 AM