Bichon Frise wrote:
The house is still a wild card. You are underwater, but if you have a decent fixed rate and can handle payments, I would leave that be for the time being. You were happy making that payment at one point, so it shouldn't change just b/c others are getting a better deal.
Sometimes personal finance is more about math than mind. Does it matter if someone is "happy" paying a mortgage at a particular interest rate? The OP doesn't say what the interest rate is, but in 2007, 30 year fixed rates were in the ballpark of 6%. Refinancing at 4% would lower their interest costs 33% every year and their monthly mortgage payment 20% (if they keep a 25 year loan). I would be pretty darn happy lowering one of my largest expenses by 20%, personally.
Not that I'm saying the OP should definitely, aggressively work towards a refinance. It depends on a lot of those missing details, and has to be fit into the entire framework of his household's financial status. But with just the few details we've been provided, at a glance it seems probable that it would be a good move.