This is my first post and I confess that I'm at a bit of a loss when it comes to financing decisions/calculations.
I've been struggling with a decision for a while and hope that smarter people can prevail and provide some input:
My better half has a condo worth about $77k (according to Fanny Mae) and she has $112k left on her loan at 7.25%. There are 25 years left on her 30 year mortgage.
She now has the option to refinance through her lender (has been confirmed), she can either do a 30 year refinance at 4.625% and save $211 per month OR she can do a 20 year mortgage at 4.5% and save about $73 per month on the loan.
The kicker is that she is planning on moving in with me and rent her place out (after a refi goes through) so if she took the 30 year there's a good chance more of her mortgage expense will be covered by the tenant's rent.
She is struggling with deciding among one of the following options:
1. Get the 30 year rate and use the monthly savings to pay down student loans faster
2. Get the 30 year rate and pay it off as if it was a 20 year loan, that way she's not locked into the higher payment but can still get the benefit
2. Get the 20 year loan
I've been unable to advise her well because paying it off faster means putting more money in a condo that won't go back up in value for quite some time, so I'm leaning with options 1 or 2...but the difference in interest is high and I'm not sure if the short-term gain might be worth the longer-term pain.
I know there's a ton of issues mixed into the facts above, but any and all input is welcome and very appreciated!!