Mortgage rates are at record lows. If you're refinancing, put $50,000 toward the loan principal. That way you can shift from a 30- to a 15-year mortgage with little bump in your monthly payment.
On a $250,000 loan balance, for example, you'll save $134,000 in interest. Plus, you'll be mortgage-free 15 years sooner.
Option 1: Refinance loan balance of $250,000 for 30 years
Interest rate: 4.21%
Monthly payments:: $1,224
Total interest payments: $190,641
Option 2: Put $50,000 in and refinance loan balance of $200,000 for 15 years
Interest rate: 3.47%
Monthly payments: $1,247
Total interest payments: $56,828
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