<p>We refinanced our prinicipal balance from a 15-year to a 30-year with a slightly lower rate, then figured out payments needed to pay it off in 13 years - the remaining years on the original 15-year mortgage. Payments (including the closing costs rolled in) are $2 a month lower than 15-year payment. (chicken feed, I know!) At 5.75% for the 30-year mortgage, making payments as if it is a 13 year mortgage, our payment to principal = payment to interest at 12th payment - in exactly one year’s time. Thereafter the interest portion goes down as the payment to principal goes up. Accelerating payments makes good sense and it doesn’t end up like this…
I know it’s weird to go from a 15-year to a 30-year, but we wanted some payment flexibility in case college fees were more than we could handle, or one of us lost a job.</p>