Mortgage Interest Rates: Homeowners Refinance Home Loans, a Consumer Perspective

Mortgage Interest Rates: Homeowners Refinance Home Loans

, a Consumer Perspective

Mortgage interest rates today are a consumers reason to refinance. Any homeowner interested in refinancing their current mortgage loan rate should consider this unbelievable offer for a consumer. The quoted rate as of today is 4.75% on a 30 year fixed rate loan. Read on about home mortgaged refinancing benefits.

But yet, I know there are consumer homeowners betting the rate will get even lower. Recently a homeowner said that if the interest rate gets to 4.50%, I will lock and refinance my home mortgage loan. The difference in a monthly mortgage payment on a $200,000 loan on the two rates stated above is thirty dollars a month. I am not about to toss thirty dollars out the window of my house. But, as a consumer, my personal perception is securing my mortgaged homestead now. I could become disabled tomorrow with no opportunity for refinancing.

Many homes are financed to the hilt. But, many houses have equity cash value in them allowing the homeowners to refinance their interest rate. Playing the tightrope remortgage game for that ever elusive best deal, turns eventually to procrastination, while new debts pile up.

Take for instance a homeowner considering refinancing his house. He currently has a 6.5% rate on $200,000 loaned. By redoing the mortgage down to the current interest levels he could save $220 per month. But what about those hidden consumer closing costs you say? Well, assuming closing costs of 3%, perceive that it takes just over 27 months to recoup those closing costs.

There are still many houses today secured by an adjustable rate mortgage otherwise known as ARMS. These were very enticing and popular programs just a few years ago. The initial mortgaged payment was low and could not adjust again for a few years. We, as consumers have been very lucky with current interest rates staying low. This has resulted in ARMS staying low during adjustment periods. But, as the economy improves these ARMS will start to increase and many home owners will be in for a shock.

Refinancing these ARMS today can give homeowners security of knowing their home loan is fixed and could never adjust higher. This perspective removes any uncertainties about the future.

Consumers have been given a gift during this current recession. Mortgage rates are tied to the ten year Treasury Bond. When the price of these bonds go up, the yield goes down. This has a direct relationship to interest rates. There are various reasons why these bond prices have risen. One reason is many investors have opted to buy bonds which tend to be safer than buying stocks. The other reason is the Fed bought many mortgage-backed securities in an effort to keep rates low.

The stock market will rebound one day. This is interesting, as many investors will start focusing on their returns. This means pulling their money out of the bond market. As the price of the bonds fall, yields increase. In turn, this will cause mortgage rates to rise. When the wheel starts in motion, it will be too late to jump on the refinancing band wagon.

Interested people desire to keep their money, under their personal control. That means halting the over consumption of giving extra cash to large companies handling thousands of old mortgages. Viewing the perspectives of someone key to the refinance options presented to house dwellers is very helpful.

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