Email question: Should we refinance to help fund house repairs?

Hello,

I read your article in the Star on April 6.  We have 5 1/2 years left on a 15-year mortgage.  Our current rate is 5.25% and our principal and interest is 1299.00 on a balance of about 76,000.  We have an opportunity to refinance 100,000 at 2.49% for ten years, thus cashing out about 20,000 for home repairs and improvements of siding, indoor water damage from roof (already replaced by insurance), window repair, flooring and updates on fixtures and countertops.  We do not want to make a house payment for the next ten years, as we are 64 and 57 years old, so we will be making extra principal payments each month.  Even with that, we will be making payments for close to 7 years, which will add over 20,000 to the total.  So, we will be cashing out the 20,000 but paying it out by extending our current 5 1/2 years. 

I understand the philosophy of saving for these repairs one-by-one; however, our budget is stretched thin with one child in college and the other one a junior in a Catholic high school, so there is not extra money for savings or a payment on a home equity loan.

What is your opinion about this refinance?

Thank you,

Marilyn