Vent: Everyone told me to wait for rates to drop before my cash out refi

I kept hearing that from friends and even a loan officer last fall. I needed about $85,000 for a major home repair and was told to just wait it out. Instead, I ran the numbers and saw that even at the 6.8% rate I got, the monthly payment increase was manageable for my budget. The key was that I used the cash to replace my entire roof and siding, which immediately raised my home's value by more than the loan amount according to a quick appraisal. If I had waited for a maybe half-point drop, the repair costs would have gone up with inflation anyway. Has anyone else done the math and decided to pull the trigger on a refi even when rates weren't ideal?

3 comments

3 Comments

river_reed1mo ago

Saw a piece on this where they said the math on waiting rarely works out. The extra interest you might save gets eaten by rising repair costs and the stress of a broken house. You did the right thing by looking at your own budget instead of a general rate prediction. Getting the work done and adding value now seems smarter than waiting for a perfect rate that might not come.

the_karen3d ago

$85,000 for a roof and siding and people wanted you to wait around for a maybe half point drop? Sounds like a real life version of "Let me just wait for the perfect parking spot while I drive past twenty open ones.

mason8471mo ago

Honestly that sounds like a gamble that paid off. I'd be worried about locking in a higher rate for years just to fix something now.