You have decided to refinance your mortgage at a much lower interest rate. Your monthly mortgage payment will decrease from $1950 a month down to $1625 a month. You originally had a 30 year mortgage which you were exactly 1 year into paying. You have decided to refinance for 30 years again. You have the following costs associated with your refinance.

Application fee $450.00

Appraisal fee $375.00

Loan Processing fee $250.00

Origination fee $200.00

Discount points purchased $1800.00

Title insurance $875.00

Flood certification fee $50.00

Credit check fee $50.00

Attorney's fee $500.00

Given how much you are saving how long will it take you to recuperate your cost of refinancing?

How much money will you save over the life of your loan from the refinance?

If you decided to cut you term down from 30 years down to 20 years and your payment remained unchanged, how much would you save over the life of the loan?