So today I went and had a talk with our lender.
When we got the loan we had such non-existent credit (always paid cash) that we couldn't get into the low interest rates. So we got the loan at a 6% rate, and we were told we had to refinance in 2 years.
Well after today I learned some new information.
We don't have to refinance within 2 years. He said he can extend it as long as we like, nothing happens. So we don't have a strict timeline anymore, except for worrying about if rates are going to increase.
Current 30 year fixed are at 4.5% at my bank. Which is already higher than I was hoping, when we first got our mortgage they were like 3.75%.
The big things holding us back from refinancing now is the loan fees. They charge more the lower your credit score is.
Credit Score | Refinance Fee
700 | 1.25%
720 | .75%
740 | .50%
Any less than that your talking 2% or 3% fees
Well since it's been over a year since our mortgage I told him to go ahead and pull our credit score to see how we were doing.
Mine is about 680 and husbands is about 670.
Not much progress in a year. He said there is nothing bad on there, the low score is just from "length of history."
So now it's a waiting game for our scores to go up to get in the lower bracket.
In all honesty with the amount we are going to refinance at the lowest our fee will be $300 and at the high end $750. So it's not all that much of a difference.
But we will just keep making payments and let our score grow.
Now the main question is, do we do as planned and refinance in the summer, or do we wait another year or two until we are actually ready for our remodel with the chance that interest rates will rise more?