Last October my home mortgage, which was an ARM went from 5.8% to 2.75%. I went from worrying about the ARM going up to worried about my tax liability. So this year I processed my taxes and everything worked out. I claim 2 exemptions on my W-4 form at work, and I’ve grown accustomed to being able to take more of my pay home with me than leave in withholding.

So of course, the APR on my mortgage changed, so did that change how much mortgage interest will be? Of course it does. So I wrote an email to Wells Fargo Bank (they that hold my mortgage) and I asked what the projected amount of interest is that I’ll pay on my home for 2012. The response from WF was worthless – it amounted to “Yes sir, you have an ARM” Yeah, I KNOW THAT.

So I called WF. Talked with a nice lady who estimated my mortgage interest would go from about 3400 to 1000 or so. Definitely a change. So I went to TaxAct and filled out the W-4 calculator and it told me I should change to an exemption of 1. So I did that. Then as I sat there I was looking at my calculations and utterly forgot my HELOC! So I went back and added the interest from the HELOC, which is fixed, and then I saw that I was back to an exemption of 2. So now we’re on a deathwatch to see if I confused WMU Payroll enough with my flippity-flappity W-4 exemption fiddling.

At least for 2012 I don’t have to redo my budget to take into account less take-home pay. That’s a huge stone off my shoulders! Whew!