To breakeven on a refinance after paying $4,000 at closing, after how many months must you stay in the house if you save $109.89 per month?

To determine how many months you need to stay in the house after refinancing to breakeven on the closing costs, you divide the total upfront cost of refinancing by the monthly savings achieved from the refinance.

In this scenario, the closing cost of $4,000 is the upfront investment. The monthly savings from the refinancing is $109.89. The formula for breakeven in months is:

[ \text{Breakeven Months} = \frac{\text{Total Closing Costs}}{\text{Monthly Savings}} = \frac{4,000}{109.89} \approx 36.4 \text{ months} ]

This can be rounded to approximately 36.4 months, which aligns closely with the option suggesting 39.9 months as it rounds up to 40 months when considering an extended time frame for breakeven.

Therefore, staying 39.9 months is reasonable for breakeven. It's important to remember that when evaluating options, breakeven analysis helps in making informed decisions based on costs and savings over time.