Mortgage refinance rates have reached historic lows
Mortgage Rates Keep Sinking — Why It Might Be a Good Time to Refinance Your Home Now
Published: Jan. 26, 2021 at 2:31 p.m. ETBy Credible
Mortgage refinance rates have reached historic lows, but refinancing your home loan will soon get more expensive.In the past few months, mortgage interest rates have continued to drop, driven by the coronavirus pandemic and reduced Fed interest rates. As of January 21, 2021, 30-year fixed-rate refinance rates dropped to 2.625%, while rates for 15-year fixed-rate refinance loans fell to 1.875%, a new 107-day low.
For homeowners looking to save money,refinancing your mortgage now and taking advantage of these historically low rates before they rise again can be a strategy to lower your housing costs.
Why should I refinance?
With mortgage refinance rates reaching historic lows, refinancing your home loan might save you a substantial amount of money.
Say you took out a home loan for $300,000 in 2018 with a 30-year term and a fixed interest rate of 4.94%. If you refinanced now and qualified for a 30-year fixed-rate loan at 2.90% interest, your monthly payment would decrease from $1,599 per month to just $1,211 per month — a savings of $389.
Plus, you would save $46,266 in interest charges over the life of this new loan, even after factoring in closing costs.
Refinancing is best if:
- You qualify for an interest rate significantly lower than what you have now
- You intend to stay in your home for a long time
- You want to get rid of private mortgage insurance (PMI)
Refinancing may not be the right option if:
- Your new interest rate is not at least half a percentage point lower than your current one
- You plan on moving within the next few years
- You have a low credit score
Keep in mind that some mortgage lenders are becoming more stringent with their underwriting processes. If you have recently experienced income decreases due to the COVID-19 pandemic or have a lower credit score than before, you may not qualify for the loan you’re seeking.
Contact:
Betty Rauch- Loan Originator NMLS#390883
954.410.1960 apply.SFLmortgages.com
Florida State Mortgage Group, Inc. NMLS#393326
https://www.marketwatch.com/story/mortgage-rates-keep-sinking-why-it-might-be-a-good-time-to-refinance-your-home-now-01611689478
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