Yep we closed on the house.  I love it.  It's my dream house.  For the first time in my life I get how people live in LCOLA.  I get the big home thing and it's incredible.  I never thought I'd ever live in a big house.  And then we bought one.  Seriously it's really nice to have all the space and privacy.  DH complains he never sees us there is so much space.  But it's because we are all unpacking and doing stuff to get settled. 

So I figured I might as well follow up with our old house is on the market. I mentioned in 2017 when we bought the house we had a 30 year for 3%.  The arm at that point wasn't worth it.  But in 2021 when DH switched jobs we decided to give up the 30 year fixed and get a 7/1 arm for 2%.  That 1% was a big deal because we still owed around $845k so 1% is $8450 in interest a year extra and less principal paydown.  The house is up for sale since 8/5/2026.  

We currently owe $734,981 so we paid off over $100k in the 5 years we've held the loan.  We paid an extra $40k in principal because of the ARM.  Then i decided and I wrote about it here I was going to invest the $720 a month into the stock market and pray i could beat the 2% and if we had to refinance I had crunched the numbers and the principal paydown alone would help.  So yeah we are ahead from the saved interest.

But what happened to my $720/month?  $720 x 60 = $43,200 saved at a minimum without investing it. I invested it and I currently hvae $89,234.  So I not only saved it every month but i also invested it and double what I should have "saved". 

If i continue down this path another 2 years yes rates are high and if i refinanced now I would be looking at 5% i bet on another ARM.  But i would be borrowing at most $634k so the amount I would be borrowing would be A LOT lower.  Even with the higher rate borrowing $640k @ 5% = $3400 which is very close to the $3120 i pay now.  I think though I'd be ahead beause I could let the arm reset and still be capped at a maximum of 7% lifetime potentially.

Either way I also would have the option of paying down more in the next two years. Well this experiement i thought was very interesting.

I hope you think so too.