Loan looming over our heads

[jfoxcpacfp]

Dreamgiver is right - don't refinance. As for paying off early, that is more emotional than tactical. I'm sure her lenders would love for you to pay them off faster, but I see no reason to do so unless having the debt causes you enough angst to affect your sense of well-being. The fact that you described the loan as "looming" makes me wonder...

[huskie92]

 

Dreamgiver wrote:

You will not get a cheaper rate so no point in refinancing. Honestly at that rate I personally would just make the minimum payment for the next 20 sone years. If you are otherwise all set and no other debt of any kind and your retirement stuff is fully maxed and such, maybe, if the thought of having a lond really bothers you, I’d entertain paying them off. Or, even better, stick the extra amount you’d pay towards the loan in a taxable account and invest it properly and see what happens. I just can’t bring myself to turn down such cheap money.

Click to expand...

Thanks for the quick response. I was kind of thinking along the same lines since her rate seemed so low relative to what I am seeing today. I like the idea of getting out of debt faster but your suggestion of perhaps investing the difference since she is at such a low rate does intrigue me. This then defaults back to the invest/pay off loans discussions of the past.

[Peds]

Nothing exists that low. Why would you refinance to a higher rate....

I agree it's cheap...but 22yrs is a lifetime. Why not aim for 15? Or 12? Or any arbitrary # and then yes, invest the rest in VTSAX.

[Dreamgiver]

You will not get a cheaper rate so no point in refinancing. Honestly at that rate I personally would just make the minimum payment for the next 20 some years. If you are otherwise all set and no other debt of any kind and your retirement stuff is fully maxed and such, maybe, if the thought of having a loan really bothers you, I’d entertain paying them off. Or, even better, stick the extra amount you’d pay towards the loan in a taxable account and invest it properly and see what happens. I just can’t bring myself to turn down such cheap money.

[huskie92]

My wife has ~173k in loans left at 2.625%. We have just been paying them off slowly over time. The payment hasn't been a problem but the loans won't get paid off for quite a while longer (22 years based on my calculations). She never refinanced the loans, they were just consolidated after med school. Is it worth refinancing or should we just increase our payments to get rid of them faster? I haven't seen any refinancing terms with better rates than she has so I was hesitant to do so. Thanks very much!