Home Mortgage Tip for "home equity" loans

Our first mortgage on my current home was in 1983. You might recall, if you are old enough, that those were the "terrible Nixon years" when interest rates skyrocketed. We had just sold our home in town and wanted to move into the suburbs. Unfortunately, interest rates were in the stratosphere right then. At that time, you could not even get a fixed-rate mortgage of any kind. The ONLY option was an ARM (adjustable rate mortgage), and the rates were 12.75% for them.
Well, we had looked and looked, and could not find anything we could afford, nor anything that was really what we had out sights set for.
And then THIS house came on the market. It was NOT what we wanted, it was larger than we had in mind. And it was NOT in the area we wanted, yet it was a "good neighborhood."
BUT, it had a $50K 8%ASSUMABLE VA loan, and we had the money from the sale of our house in town to pay the difference between the loan and the price. It was a match made in heaven.

I remember thinking to myself, 'well, this is one house we'll never re-finance!'
Boy, was I wrong!!

I have refinanced the house not once but twice since then. It was the only logical thing to do.
The first refinancing came when interest rates came down to below 7%. I saved almost $100/month on my payments on a 15-year loan.
The 2nd refinancing came after I had put about $12K on my home equity line (due to my stepson having an emergency surgery with no insurance), and refinancing occurred when interest rates fell below 6%. More savings. These were both done with my banking institution, US Bank.

Here's the Part about Home Equity Savings!

The most recent action I have taken occurred just after I looked at my yearly 1099 interest statements on my home mortgage loans. I had loaned my stepson the money to buy a new car, which put yet another large balance on my home equity loan. It nearly blew my eyes out to see that my $12,000+ home equity line mortgage loan at 8.5% actually had more interest on it than my $29,000 balance of my primary mortgage at 5.875%! Yikes! I decided to refinance my home yet again, as my home equity loan was on a variable rate basis.

However, when I called the US Bank loan officer to ask about re-financing my entire home, she told me that I could "float and lock" just my home equity line balance. Whew! Nobody ever told me I had that option!

So I called my local US Bank branch, and sure 'nuff, I was able to lock my current home equity balance at 5.99% interest for a 10-year payoff. That cut my monthly home equity line payment from $192 to $140(!), and changed the payoff from 30 years to 10 years. (Note: this did nothing to my primary loan, only my 2nd mortage, aka "home equity line")

So my advice is, IF you have sufficient equity in your home, and IF you have a variable home equity loan that is accruing high interest, check to see if you can "float and lock" your equity line balance. (this does not prevent you from continuing to use the equity line loan, generally). This single action could save you tremendous amounts over the life of the loan PLUS really lower your monthly payments.

OH, and by the way....Here's a few points you may be interested in:
1. The "float and lock" depends on your having significant equity built up in your home.
2. You are entitled to do ONE "float and lock" without charge, but if you do it more than once, you may have to pay a fee.
3. I did my "float and lock" ENTIRELY over the phone, did not have to sign a single document, and the change took effect the same day I called. Easy as Pie!

If you want to find out more about "float and lock" you can do a google search for "float lock home equity loan" (sans quotes). Adding your lender's name into the search terms might even take you to specific information for your mortgage company.