Very happy to report that I got offered the best rates from Earnest for refinancing. Not sure whether to choose their fixed or variable APR.
Loan Amt: ~$80,000
Current Loans: 6.8% and 4.0%
New Loans: 3.25% fixed or 2.57% variable APR over 5 years are their best products.
The difference in interest paid, over the life of both loans, is like $1,250. Not that much over 5 years.
I plan on paying it off much sooner anyway.
Was looking into what affects their variable APR loan and it's tied to LIBOR, they say current LIBOR rate is 1.34%, and they add a margin of 1.48 for total of 2.82%. (you get to deduct 0.25 with autopay, thus 2.57%).
Questions:
First, I can't seem to verify a LIBOR of 1.34%. I checked several sources online and the USD LIBOR Overnight rate (the lowest one) is 1.43. Isn't that a little concerning? I also read some predictions, for instance, by Kiplinger, that the feds will likely increase their rates twice next year. I know that Fed rate does not affect LIBOR, but they almost always move in lock-step with each other. So from that I conclude that the LIBOR rate will increase twice next year as well.
Anyone else hear rumors about what the rates will do next year?
Any other thoughts about what might be a safe move here? I'm refinancing because I want a better rate, but also just in case something happens to me like I get into an accident or something and need to make minimum payments for a long period of time.
Thanks
Loan Amt: ~$80,000
Current Loans: 6.8% and 4.0%
New Loans: 3.25% fixed or 2.57% variable APR over 5 years are their best products.
The difference in interest paid, over the life of both loans, is like $1,250. Not that much over 5 years.
I plan on paying it off much sooner anyway.
Was looking into what affects their variable APR loan and it's tied to LIBOR, they say current LIBOR rate is 1.34%, and they add a margin of 1.48 for total of 2.82%. (you get to deduct 0.25 with autopay, thus 2.57%).
Questions:
First, I can't seem to verify a LIBOR of 1.34%. I checked several sources online and the USD LIBOR Overnight rate (the lowest one) is 1.43. Isn't that a little concerning? I also read some predictions, for instance, by Kiplinger, that the feds will likely increase their rates twice next year. I know that Fed rate does not affect LIBOR, but they almost always move in lock-step with each other. So from that I conclude that the LIBOR rate will increase twice next year as well.
Anyone else hear rumors about what the rates will do next year?
Any other thoughts about what might be a safe move here? I'm refinancing because I want a better rate, but also just in case something happens to me like I get into an accident or something and need to make minimum payments for a long period of time.
Thanks
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