Refi and Home Finance

I bought my house about six years ago. I was going through one of those life changing situations where I had to move but I didn’t have a lot of money to spend on a house though. This was before the big real estate boom, and getting loans was not as difficult as people are finding it to be now. So I got what was called a 90/10 loan. I got a first loan for 90% of the purchase price and a second loan for 10% of the purchase price of the home.

Then values skyrocketed and everybody refinanced their homes and took all kinds of cash out so they could buy things like new cars. I didn’t though. I was smart. I just kept my loan. What I didn’t really think about though were some of the other expenses I didn’t need to be paying. I was paying for that crazy mortgage insurance because my primary loan was higher than 80% of the loan. I also had a fairly high rate on the 10% loan.

So I called my bank and asked about combining the two loans. And because I bought before the boom as well as the fact that I have been paying down the principal, I had quite a bit of equity in the home even though many of my friends were upside down! I refinanced two loans into one, and now my payment is less than it was before!