Yes, refinance that 15-year 8.5% mortgage at under 8%


Dear Mr. Gisriel: I refinanced my mortgage two years ago, taking out a 15-year fixed, 8.5 percent loan. Today, I can take out a new 15-year loan for 7.125 percent. I am thinking of refinancing, but don't know if it's a good idea.

Since most of the money paid during the first few years of the loan is interest, not principal, all the money I paid on my existing loan would be lost money. If I refinance, I will have paid two years of interest on a loan that no longer exists.

Wanda Fowler


Dear Ms. Fowler: You should definitely think about refinancing again today!

The money that you have already paid on your existing mortgage for interest will not be lost. In fact, all the money paid for mortgage interest will be tax-deductible to you the year in which you paid, whether you refinance again or not.

Additionally, the points that you paid for your first refinance will also be deductible to you as an additional interest deduction for the year in which you refinance again, as opposed to amortizing them over the life of the loan.

Mortgage rates are now at 25-year lows. Today, you can probably obtain a rate in the 6.5 percent range if you are looking for a 15-year fixed rate mortgage. I advise you to call a mortgage lender and shop rates and terms but don't let this opportunity pass.

Dear Mr. Gisriel: Why can a $350,000 house have the same property taxes as one that is one-half the price?

Sheila DeCarlo


Dear Ms. DeCarlo: Real property taxes in Maryland are based on a formula whereby the local jurisdiction's tax rate is multiplied by the assessed value of the subject property (i.e., land plus improvements.) Each of Maryland's 24 local subdivisions set their own local tax rate, while by law the State of Maryland oversees a state assessment office which in theory is supposed to result in "uniform" assessments throughout Maryland.

If, for example, one local subdivision's tax rate is approximately double of another local subdivision's rate -- e.g., Baltimore City's rate is approximately double that of Baltimore County -- then a $350,000 house in Baltimore County theoretically will have approximately the same real taxes as

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