How many homeowners have you worked with in the
past who seemed overwhelmed by the entire
process? If you're like most mortgage brokers or
real estate agents, then you know quite a few.
There are seemingly countless people who have
bought homes who wish, several years later, that
they had worked a bit harder or perhaps waited a
bit longer to get the better mortgage rate or
terms or points.
Or perhaps there are those homeowners whose
credit wasn't quite where they would have liked
it to be at the time of their application and
were left with a rate that now seems unfair to
them. They signed to paperwork, they're locked
in, but refinancing is always an option and right
now could be the best time to encourage these
homeowners to refinance to a better mortgage.
Interest rates continue to remain at historic
lows
One of the major indicators that right now is the
best time to refinance is that interests rates
are at their lowest levels in history. There are
individuals who are securing thirty-year
mortgages for under five percent. If a homeowner
can move from paying just over seven percent to
around five, that would equal tens of thousands
of dollars by the end of the mortgage term.
At this point in time, no one really knows what
the federal government will do with the interest
rates in the coming year. Many 'experts'
predicted that the rates would have increased by
now and still the Fed is holding them at near
zero percent for lenders. There are millions of
homeowners who would benefit from refinancing
their mortgages now thanks to these low interest
rates.
Credit score has improved
Another major reason that now is a good time for
homeowners to consider refinancing their mortgage
is that their credit score will have likely
increased since they purchased their home. This
certainly isn't for all homeowners, but those who
may have missed payments, been slow with
payments, or made other mistakes when trying to
build their credit history prior to purchasing
their home.
A lower credit score will certainly affect the
mortgage rate they receive and if they have
managed to boost their credit score by twenty,
thirty, fifty, or even one hundred points since
they took out their mortgage, then now, with the
low interest rates, is the perfect time to
refinance their loan.
Banks are hungry for positive business
People aren't buying homes at the moment. There
are a number of reasons for this, but with the
housing crisis of the past few years, that has
left many homes foreclosed. Banks are sitting on
empty lots and dealing with increased competition
for customers. That usually means that since
demand is low, rates will be lower.
A homeowner who is looking for a better mortgage
rate will likely be able to find it with another
financial institution, especially if they have
already proven that, through this economic crisis
and housing mess, they have been paying their
mortgage on time every month. The business end of
the industry is sitting in their favor.
Many people are in a holding pattern
There are many homeowners who are staying put
with their homes and their mortgages. The value
of their home may have dropped since they
purchased, especially if they bought their home
four or five years ago and they are merely
waiting for the value to come back up. They may
use this as a justifying reason why they aren't
willing to refinance right now, but it is
precisely the reason that they should consider
it.
There has really never been a better time to
refinance to a lower rate. If there's room to
make significant savings for the homeowner, then
it may pay to encourage them to at least look
into it.
David
past who seemed overwhelmed by the entire
process? If you're like most mortgage brokers or
real estate agents, then you know quite a few.
There are seemingly countless people who have
bought homes who wish, several years later, that
they had worked a bit harder or perhaps waited a
bit longer to get the better mortgage rate or
terms or points.
Or perhaps there are those homeowners whose
credit wasn't quite where they would have liked
it to be at the time of their application and
were left with a rate that now seems unfair to
them. They signed to paperwork, they're locked
in, but refinancing is always an option and right
now could be the best time to encourage these
homeowners to refinance to a better mortgage.
Interest rates continue to remain at historic
lows
One of the major indicators that right now is the
best time to refinance is that interests rates
are at their lowest levels in history. There are
individuals who are securing thirty-year
mortgages for under five percent. If a homeowner
can move from paying just over seven percent to
around five, that would equal tens of thousands
of dollars by the end of the mortgage term.
At this point in time, no one really knows what
the federal government will do with the interest
rates in the coming year. Many 'experts'
predicted that the rates would have increased by
now and still the Fed is holding them at near
zero percent for lenders. There are millions of
homeowners who would benefit from refinancing
their mortgages now thanks to these low interest
rates.
Credit score has improved
Another major reason that now is a good time for
homeowners to consider refinancing their mortgage
is that their credit score will have likely
increased since they purchased their home. This
certainly isn't for all homeowners, but those who
may have missed payments, been slow with
payments, or made other mistakes when trying to
build their credit history prior to purchasing
their home.
A lower credit score will certainly affect the
mortgage rate they receive and if they have
managed to boost their credit score by twenty,
thirty, fifty, or even one hundred points since
they took out their mortgage, then now, with the
low interest rates, is the perfect time to
refinance their loan.
Banks are hungry for positive business
People aren't buying homes at the moment. There
are a number of reasons for this, but with the
housing crisis of the past few years, that has
left many homes foreclosed. Banks are sitting on
empty lots and dealing with increased competition
for customers. That usually means that since
demand is low, rates will be lower.
A homeowner who is looking for a better mortgage
rate will likely be able to find it with another
financial institution, especially if they have
already proven that, through this economic crisis
and housing mess, they have been paying their
mortgage on time every month. The business end of
the industry is sitting in their favor.
Many people are in a holding pattern
There are many homeowners who are staying put
with their homes and their mortgages. The value
of their home may have dropped since they
purchased, especially if they bought their home
four or five years ago and they are merely
waiting for the value to come back up. They may
use this as a justifying reason why they aren't
willing to refinance right now, but it is
precisely the reason that they should consider
it.
There has really never been a better time to
refinance to a lower rate. If there's room to
make significant savings for the homeowner, then
it may pay to encourage them to at least look
into it.
David
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