Refinance mortgage or pay off your home loan?

Q: We own a home with a mortgage balance of $50,000 at 8.75 percent. We are thinking of refinancing but have the funds to pay off the loan entirely. My husband is unemployed. Should we take a cash-out refinance mortgage or pay off the loan and take in rental income from our tenant?

A: It sounds as if you’re trying to improve your cash flow while your husband is unemployed. But even if he were working now, refinancing would probably make more sense than using $50,000 of your cash cushion to pay off the loan.

At today’s rates of around six percent for a 30-year fixed-rate mortgage, your monthly payments should be just $300 a month. And while extending the term of your loan may not be the best move in the long run, as long as your loan has no repayment penalty, you can choose to accelerate payment later when your husband is employed. Borrowing extra money through a cash-out refinance, however might increase your monthly payment, and you’d start paying interest on that money immediately. Instead consider some advice : Refinance only your existing loan, and open a home-equity line of credit. You’ll be able to instantly access your home’s equity if need be but without paying any interest on the credit until that time.

Empower yourself to survive

Are you new at your job or flopping aimlessly in your current one? You might need to become a bit more savvy in dealing with your employer.
Here are a few tips.

• Avoid launching misdirected or misguided questions. Before you start asking willy-nilly, survey your work environment and observe how things operate.

• Don’t assume others are looking out for your career. They’re probably not.

• Empower yourself. Don’t wait for someone to ask you about your next promotion or move.

• Networking skills are every bit as important as professional or technical skills for your job.

• Who’s really in charge? The real power is not always sitting at the top of the organisation’s flow chart. Learn who really runs the show.

• Navigate the culture. A new place and the people it attracts can take time to figure out.