I did a mortgage for one on my clients on the home they purchased in Florida. Originally they purchased as a second home and eventually sold their primary home in Connecticut and live Florida full time.
Unfortunately at the time they purchased in Florida it was at the height of the market, they put 25% down and had a 6.75% interest rate. Fortunately, the market they were in has come back very nicely. We discussed a couple of options, but I recommended an appraisal be done to get a handle on value.
It turned out the value was stronger than was estimated. Instead of doing a HARP loan, we did a conventional mortgage. They ended up not quite having 20% equity, so the decision was made to pay down the mortgage enough to avoid mortgage insurance.
Between closing costs and pay down on the mortgage, they came up with $11,500. They are saving $360 per month. It will take them about 32 months to break-even and enjoy the 3.5% mortgage rate that they now have.
