Mortgage Rates Remain Solid Into Holiday Season
If you have been waiting for rates to drop in order to refinance your home loan, consider current refinance rates as your early Christmas present. Par 30 year fixed rates are still hovering in the 5 percent range, which can provide huge benefits to those currently at 6 percent or higher, and looking to either reduce payments or shorten the term of their mortgage.
Just remember that the primo rates are being offered to those refinancing with a loan-to-value of 80% or lower and excellent credit scores. Although mortgage programs across the board have dropped, the previous scenario mentioned is where you can really rake in a nice drop in rate.
For those that have a high loan-to-value ratio and/or poor credit scores, FHA refinance programs are not far behind conventional pricing and still offering great rates.
If you are still on the fence waiting to unwrap that mortgage present this holiday season, consider the following. Bottom line, how much will I lose if I do not lock a rate now? Secondly, and very important… How long do I plan to stay in a new mortgage if I lock a low rate? For instance, if you can save $200 per month by locking now and it costs $4,000 in closing costs, you will break even in 20 months. Now, after 20 months, you will make out with a free and clear $200 per month savings and net a total interest savings of $68,000 over the term of a 30 year mortgage. Now that’s some Christmas cheer!
Home values continue to plague many looking to refinance as home prices continue to fall. The National Association of Realtors said today that existing home sales fell 8.6 percent to an annual rate of 4.49 million in November, from a downwardly revised pace of 4.91 million in October. Just as important is the fact that sales of distressed properties made up 45 percent of all property sales in November. That is a bad sign in the short term, but may prove to at least stabilize home prices going into the new year.
The Treasury yields are still ultra low, while the mortgage spread remains at very high levels. Expect mortgage rates to hover in the current range for a while, unless the yields have a strong bounce, in which case rates will rise close to the increase in the 10-year Treasury yield. If you are undecided about locking a rate now, consider that we are still near historic lows and you could stand to make a nice long-term benefit for rate-term refinances and a significant monthly savings on a debt consolidation loan.
Merry Christmas!
May the Mortgage Refinance Rates be with You!
Refinance Tool Box
Just remember that the primo rates are being offered to those refinancing with a loan-to-value of 80% or lower and excellent credit scores. Although mortgage programs across the board have dropped, the previous scenario mentioned is where you can really rake in a nice drop in rate.
For those that have a high loan-to-value ratio and/or poor credit scores, FHA refinance programs are not far behind conventional pricing and still offering great rates.
If you are still on the fence waiting to unwrap that mortgage present this holiday season, consider the following. Bottom line, how much will I lose if I do not lock a rate now? Secondly, and very important… How long do I plan to stay in a new mortgage if I lock a low rate? For instance, if you can save $200 per month by locking now and it costs $4,000 in closing costs, you will break even in 20 months. Now, after 20 months, you will make out with a free and clear $200 per month savings and net a total interest savings of $68,000 over the term of a 30 year mortgage. Now that’s some Christmas cheer!
Home values continue to plague many looking to refinance as home prices continue to fall. The National Association of Realtors said today that existing home sales fell 8.6 percent to an annual rate of 4.49 million in November, from a downwardly revised pace of 4.91 million in October. Just as important is the fact that sales of distressed properties made up 45 percent of all property sales in November. That is a bad sign in the short term, but may prove to at least stabilize home prices going into the new year.
The Treasury yields are still ultra low, while the mortgage spread remains at very high levels. Expect mortgage rates to hover in the current range for a while, unless the yields have a strong bounce, in which case rates will rise close to the increase in the 10-year Treasury yield. If you are undecided about locking a rate now, consider that we are still near historic lows and you could stand to make a nice long-term benefit for rate-term refinances and a significant monthly savings on a debt consolidation loan.
Merry Christmas!
May the Mortgage Refinance Rates be with You!
Refinance Tool Box
Labels: bad credit, business, credit scores, economy, finance, money, mortgage rates, refinance, refinance rates
posted by Jim Bisnett at
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