In Sep 2016, I bought a single family home to use as a rental, and totally rehabbed it.

In May of 17 I put a mortgage on it and paid my credit cards back that I used to purchase and rehab. The property appraised at 171k, and I had 120k in it. With closing costs and taxes, I borrowed 124k @ 4.875 Interest. My goal is to pay off the property as soon as possible.

My payments are 656 for 30 years. I started out paying 1100 a month, and for the last year I have been paying 1456 a month. I am currently down to a balance of 81k and if I keep making these same payments, the property will be paid off in Sep of 26. that is 64 more payments.

A loan officer from the bank called me today and wants me to refinance the 81kk outstanding balance at 3.125% . for 10 years. 3k in closing costs and fees will be added to the loan, so I will be borrowing 84k for 10 years. My payments would be 816 per month.

I am wondering If I keep paying what I have been, if I will ever recover the 3k in additional costs for the new loan.

Right now, I am leaning against it and just want to pay off as quickly as possible.

Any advice or things I may not be aware of?

Your banker just wants to put that $3000 in his pocket.

Both rates are under 5 percent which is real good.

I'd just keep paying like you are.

Another thing to think about: We don't know what will happen over the next few years, but uncertainty is for sure. I'd keep up on things and be prepared to make adjustments as I thought were necessary. Each of us is different, so there's no "one size fits all" answer. So we must analyze, adapt, overcome.

Stay the course. The refi is a distraction. You are mainly down to principal at this point and have avoided a lot of the interest by paying the principal down early.

this might help.

It is commendable that you are trying to pay off debt early. But did you think about what exactly you are doing?

You see the government is printing up tons and tons of dollars. So what has this done to the value of that dollar? You are locked in for a long enough time that you can ride through an inflationary period with a FIXED debt amount - which also is being devalued. Since debt is being devalued, why push yourself so hard to pay it off?

I understand there are lots of folks out there that will tell you you a slave to debt, but there are different types of debt. The debt you are carrying is used to create an income stream so it being an appreciating asset- it is alright.

Now is not the time to push yourself hard in paying it down.

So should you refi. You are paying $1,456 for another 64 payments for a total of $93.184. This compares to 120 payments of $816 for a total of $97,920. The refi will give you a bit more monthly cashflow, but the price for that extra cashflow would be about $4,700.

I will post back here in 10 minutes after doing some work on my financial calculator

I just ran the numbers with you refi-ing and paying the extra and you would have the debt paid off with the refi in August 2026 roughly 30 days ahead of staying the course.

Bonanza is spot on.

Don't bother. By paying extra and reducing the principle faster, you are paying less interest over the total loan amount already.

After all, lowering your principle that the interest is calculated against accomplishes the same thing for free.

The bank just wants some extra funds. Don't fall for it. It's only a 1.75% reduction in interest anyway. That's not much. Certainly not worth $3000.