Is It Time To Refinance Your Mortgage?
A dominant feature of the real estate market for the past two years has been low mortgage rates. Florida to Colorado, and beyond, historically low mortgage rates have created a surge of interested home buyers in nearly every market. The opportunity to lock-in low mortgage rates for the life of a home loan was simply too good to pass up. Existing homeowners saw a great opportunity for themselves. Historically low rates created a market where many homeowners have seen their home prices rise. At the same time, rates dropped below levels of their current mortgage. For this group of homeowners, it made sense to try and refinance their mortgages. However, conditions are changing. Mortgage rates have started to rise and will probably continue in that direction. Rising mortgage rates means that if you have not given thought to refinancing your mortgage, now might be the right time to consider it.
Mortgage Rates are Rising
Unfortunately, home buyers and homeowners can’t expect record low mortgage rates if they apply for a new mortgage or a mortgage refinance. Mortgage rates are rising. Homeowners and home buyers recognize these trends and are taking advantage while they still can. Because, while mortgage rates are rising, they are still below historic averages and many homeowners and home buyers can still benefit. That is why it is no surprise that as mortgage rates have been rising, so have the number of mortgage refinance applications. Mortgage refinance can help some homeowners secure lower mortgage rates, which can reduce monthly payments, as well as how much is owed over the life of the home loan. Locking in a refinanced home loan with as low of a mortgage rate as possible is always worth considering. It is easy to understand why many homeowners are rushing to see if a refinance might help them.
Home Equity is at All-Time Highs
Today’s rising mortgage rates are not the only reason why many homeowners are trying to refinance their mortgage while they can. Some are also rushing to take advantage of rising home equity. As home buyers can attest to, home prices have risen dramatically over the past two years. Along with home prices, so have home values. In turn, homeowners across the country are seeing record-levels of home equity. All of a sudden, many homeowners now owe significantly left on their existing mortgages compared to the market value of their home. For some, this is a great opportunity to see what a cash-out refinance might be able to do.
A cash-out refinance allows you to replace your old home loan with a new mortgage for a larger amount. You then get the difference between your old mortgage and your new loan in cash. It is a way of accessing your home equity now while it is still at record levels. Many homeowners look into a cash-out refinance because there are always a number of ways your life can improve with an infusion of cash. You can use it to buy an investment property or to consolidate debt. You could also use it to remodel your house or go on your dream vacation. The possibilities are endless.
Final Thoughts
The real estate market and mortgage industry never stay static for long. Conditions are always changing. Today, it looks like conditions are favorable for homeowners who have been considering a mortgage refinance. Rates appear to only be going higher and home values are already at all-time highs. How much longer can today’s environment remain favorable? The bottom line is that if you are a homeowner who has not recently refinanced their mortgage, it might be time to explore it. At the very least, it might be worth taking complimentary mortgage qualifier to see what the numbers look like and if a mortgage refinance makes sense. There is no harm in seeing if you might be missing out on lower mortgage payments or on using your equity. Contact us if you want to explore your mortgage refinance options today.
