Recent Rate Hikes, Refinancing Savvy
"The average 30-year mortgage rose to its highest level in nearly two years this week," according to an article by Jennifer Warnick for 12 News On Your Side.
This has actually been an expected hike in rates and a topic of much speculation all year, but especially once August and September hit. However, with the job report not as hopeful earlier in the season, rates haven't increased until now. With the most current job report comes this recent hike in rates, and once The Fed gets the ball rolling on rates, an increase will likely be steady based on past trends. However, according to the article, the "biggest impact on the mortgage market is fewer existing homeowners refinancing their loans."
If you want to use your equity toward a major home repair, have better credit, or are simply better off than when you first took out your home loan, there are a few key factors to remember when looking to refinance.
First is that refinancing for a shorter term is what will save you money in the long run. Taking out another 30-year mortgage even at a better rate will likely end up costing you more in the long run. Another thing to watch out for is too-good-to-be-true rates. Some banks offer great rates but with greater closing costs. Refinancing through a mortgage broker can help ensure better rates along with lower closing costs.
Last but not least, if you find that your loan will end up costing you more than the original quote, remember that state law gives a three day grace period for you to back out of the deal free and clear.
Refinancing can be a great financial step forward in your investment!
To read the full article by Jennifer Warnick, click here.