Tuesday, November 17, 2015
Mini-Mortgage surprises member with major league savings
Lynn Willenborg, member service representative at Dupaco's Dyersville, Iowa, branch, was on the lookout for opportunities to save our members money and uncovered an opportunity for major league savings. Here's her story:
A member recently called me to inquire about his home equity line of credit. I was updating his information when I noticed that his mortgage loan rate was at 5.25 percent. I wondered why he hadn't yet refinanced the mortgage, with our rates being so low.
With about 24 years left on his 30-year loan, I suggested we look at refinancing into a 20-year term. He didn't much care for the idea of paying closing costs.
So, I thought that maybe our Mini-Mortgage would be an option. With its shorter term, the Mini offers the benefit of faster payoff with minimal closing costs. Plus, the time from start to closing on a Mini-Mortgage is significantly shorter than a traditional mortgage refinance. I laid out the details of the Mini, suggesting a 10-year term (multiple terms are available) and explaining that with the shorter term comes higher monthly payments.
That's when he threw me a curveball. He asked how his payments would look if he put down an extra $20,000 on the mortgage. What a game changer for this member!
Compared to his current traditional mortgage loan payment, his Mini-Mortgage will increase his payment by only $95 a week. And the savings? Over the life of the loan, the Mini will snag him more than $40,000 in interest savings! Plus, he'll be mortgage payment free at the age of 42. Win-win!
Curious whether we can positively impact your financial future? Contact us!