Refinancing To A 30 Year Fixed Mortgage Rate [mortgageprotectiontips.blogspot.com]
The average rate for a 30-year fixed loan fell to 3.78 percent. That's four straight weeks of lows.
mortgageprotectiontips.blogspot.com Mortgage Rates Hit Record Low
Refinancing your home is a big decision. There are many things to consider in order not to land in a bigger debt. Interest rates for purchase of properties are at an all-time low this year. Some experts will probably recommend that this will be a good time for you to refinance your mortgage especially if you are currently on an adjustable rate mortgage. It can be a good idea if you check out the current interest rates and value of your property before you even decide to refinance your property. Based on your findings, you may have a clearer idea and be more prepared if it is the best time to convert your 15 year adjustable rate mortgage (ARM) to a lower 30 year fixed mortgage rate.
With an adjustable rate mortgage, there is always a chance of the interest rate increasing in relation to the current index and margins. So when the interest rate is relatively lower to the current interest rate you are paying, some experts may think it is wise that you refinance your 15 year adjustable rate mortgage (ARM) to a 30 year fixed mortgage rate. Generally, if the current interest rate is 2% lower than the rate you are currently paying, it is considered to be a good time to convert your ARM to a fixed mortgage. But that is not always the main thing you may want to weigh in before deciding to refinance to a fixed rate. There are other considerations that you might want to bear in mind.
When interest rates are low, it is most likely due to an economic downturn. When the nations economy is slowing down, property values usually decrease as well. So it may not always be a good option to refinance your home based on the low interest rate alone. Additionally, if your property value has gone down, it might not be the best time for you to refinance. For example, if you refinance your home up to even 80% of the appraised value during the time when property value is low, the amount might still not be enough for you to pay off your original mortgage. That in itself can put you in a bigger debt situation that before. So it is always advisable that you weigh in your options carefully before deciding.
Before you actually apply to refinance your home to a 30 year mortgage rate, you might want to pay off any late payments and improve your credit scores. Due to the fact that refinancing may get you a lower interest rate than that of your initial mortgage, lenders are expected to be stricter and may screen every possible aspect of your credit history. So it is always wise for you to plan the right time for you to refinance. You might also want to pay off all your due payments on time. When lenders see that you are never late in making payments, you will inadvertently build up your credit score and improve your chances of being approved for a refinance. You would also be wise to check your credit scores from time to time and remove any errors because this will be an important aspect of your credit history in the eyes of your lenders.
Generally it is a good idea to convert your 15 year ARM into a 30 year rate if you are sure that the interest rates are low and your property value is still high. Instead of always being on tiptoes worrying about increasing interest rates, converting your 15 year ARM to a 30 year fixed rate mortgage can significantly cause a change in your monthly payments and you will not have to worry about any increase on the interest rates. After all, a fixed rate will stay the same throughout the life of your loan. But like everything else in life, it is always wiser for you to consider all options before jumping in. So be smarter and learn all you can about refinancing in order to make a decision that may benefit you and your family.
Suggest Refinancing To A 30 Year Fixed Mortgage Rate Issues
Question by Lepke: Will 30 year fixed rate mortgage rates ever go down? Everybody keeps saying that the economy needs a jump start - well, I am certainly willing to do my part and spend more once I have refinanced my current mortgage. However, it seems like the 30 year fixed rates continue to hover around 6-6.25%. Is there any reason to believe that these rates will fall? Best answer for Will 30 year fixed rate mortgage rates ever go down?:
Answer by glenn
Just like everything else they will go down and they will go up. I have been in real estate 30 years and seen a lot of things happen that "everyone" said would never happen. A practical answer to the question I think you are asking is that I do not believe that mortgage rates will be much lower anytime soon, they might be higher within the next year. Investors that provide the money for 30 year mortgages are worried that inflation is coming back and they are reluctant to commit to low rates.
Answer by PelMel
If they go down, it won't be by much. You pay a premium for the predictability of a 30-year note. To get a better rate, you'll need accept some amount of risk.
Answer by good guy
ask anyone who suffered through the high mortgage rates in the 70's--15% rates were not uncommon--and they will tell you, if you can get a 6% loan (or thereabouts), take it if it's a fixed...if you "wait" then you could lose out when rates go higher...if you are refinancing, make sure you figure in all the relevant costs associated with the refi. It might help if you stated what your present rate is, if it's a variable (risky) or a fixed...no one knows for sure what the future holds, so prepare for that as best you can.
Answer by saeed q
As an FYI… per the Federal Trade Commission (FTC) http://www.ftc.gov/freereports , there is only one source for you to get a free credit report from all three credit repositories, “annualcreditreport.comâ€. https://www.annualcreditreport.com/cra/index.jsp Do not give anyone else your personal info without seeing them in person. Make sure to price out your loan with your LOCAL banks and mortgage brokers only. A lot people giving advice on here are also looking to give you a loan (it’s not advice, its advertising), if they are not local to you and you can’t get to them within 1 hour don’t fall for it. They say they are licensed in all 50 states, what does that mean? Which state do you have to look in first if something goes wrong? KEEP IT LOCAL; DON'T GET RIPPED-OFF BY SOMEONE IN WHO KNOWS WHERE WHICH YOU WOULD HAVE NO DIRECT ACCESS TO. Remember Buddha's advice: "Believe nothing, no matter where you read it or who has said it, not even if I have said it, unless it agrees with your own reason and your own common sense." You are the only "expert" you can trust: All brokers, and every other loan officer guru giving advice here with a .com or contact me at the end is "selling" you something (it’s not advice, its advertising). Don't buy "it." When shopping for a mortgage, here are a few things to do to maximize your savings and time: 1. When asking for a Good Faith Estimate(GFE), tell each mortgage originator (lender) what interest rate to use so you can compare apples to apples (rate affects closing costs). This is probably a different thought process for you because you always shop interest rates on a mortgage right? Remember all mortgage originators have identical wholesale interest rates. If you shop the same interest rate among mortgage originators, it levels the playing field and discloses what they want to charge you for their time to originate and close your mortgage. It is similar to shopping for a car. Why does the exact same new car vary in cost from one dealership to the next? Some dealers want to make more profit than others. 2. Secure Good Faith Estimates from various mortgage originators within a 4 hour time frame (rate and pricing can change daily and even multiple times in one day). 3. Do not compare the prepaids, reserves, escrow, title charges, and government recording sections of the estimates; third part fees are not controlled by the mortgage originator. 4. Ask each mortgage originator to base the interest rate on a 30 day lock unless you need longer. 5. If the loan allows you to waive escrow (paying taxes & insurance yourself), let the mortgage originators know because this will affect closing costs. 6. If refinancing, let the mortgage originators know if you are pulling cash out. A cash-out refinance usually increases closing costs. Your Biggest Challenge The mortgage industry today has never been more unethical. The industry has produced several record-breaking years in a row regarding total origination and as a result, greed is driving the industry. Your biggest challenge is receiving a Good Faith Estimate that is provided to you in "Good Faith"! We spend more time showing consumers how mortgage originators are lying to them in regards to an estimate given! That’s right, lying! “Bait and switch†has become a prominent sales tool in the mortgage industry. Bait you in with a bogus estimate then switch things after you are hooked. This is so discouraging; banks and so called direct lenders have become some of the worst at this practice. Education is your biggest weapon against this practice. Take the time to fully understand closing costs and rates before proceeding. You should know exactly how much the mortgage originator is getting paid by all sources (no matter where it comes from, it's ultimately coming out of your pocket). Protect yourself by asking for and receiving prior to application and origination a written guarantee stating the TOTAL amount of compensation (YSP, rebates, commissions, kickbacks) that will be received and kept by the mortgage originator. This will help assure that your best interest is kept in mind. Originating a mortgage is a service, not a product; compensation should not be based on the loan amount or interest rate. All ethical, honest, upfront, transparent mortgage originators will be more than willing to provide you with a written total compensation guarantee in addition to the (GFE) Good Faith Estimate (focus on the word “Estimate†because that is exactly what it is, an estimate of charges) prior to originating your loan.
