Refi or stay put?

[Kenneth LaVoie]

Uusually deciding whether to refi or stay put is easy but I'm having a tough time deciding. I have an opporunity to refi two 4-units. each mortgage is around 80k, 3 year ARMS, currently about to re-set at 4.375. I have an opportunity to re fi (total costs around 1,800 ea.) for 5.5% for 20 year amort / 10 year lockin. I'm thinking of doing one and leaving the other... the 3 year arm has a limit of 2% pts per re set, 6%pts total (so 9 years from now it could be as high as 10.375% assuming it resets next month at 4.375) - loans have approx 17 years left. We have stopped buying and are now putting all cash flow toward paying off our most expensive mortgage. My spreadsheets tell me that we will save 21k give or take (assuming worst case: current loan goes up 2% ea. 3 years and prospective refi stays 5.5% for 10 years then goes to 8.5 for remaining term)

I also have other buildings, various terms, so I'm thinking that perhaps it's a good diversifier to re fi at least one? your thoughts??

current portfolio / loans (1,000,000 owed, 1.4 building value)
I have 11,8,7,7, unit bldgs all 5 year / 5.5%
I have 2 unit, plus 2 SFH free and clear
I have two 4 units, 2 unit, 2 SFH all under the 3/3 described above

thank you for helpinig me see thru my "head noise!"

[Rich Weese]

Long time Kenneth! If I remember correctly, you're in for long term. I don't like holding kegs of dynamite (arms) . The keg fuse is lit-just the length is unknown when it will blow. It seems the 5.5% is a bit high and is your 10 year timeframe for the balloon or then it goes to variable?
I like the longest term , lowest rate , and no arms. In your calculations, how quickly could you pay off other loans that are arms? I just sleep better at night not having to count on rates staying the lowest in HISTORY! You're trying to move to security and passive income-interest rate increases could scuttle that, imo. Rich