Mortgage is a lifesaver for those who want to buy real estate property but can’t afford to pay outright cash. The problem with many Americans with mortgages is that they don’t know their mortgage rate and would be stunned to find out that they are paying too much especially now that long term interest rates have dropped and there are new alternative rates being offered to homeowners by the government. You can get an instant online mortgage rate quote right now and work the numbers to find out if you should apply for re-finance or continue paying the current rate.
Understanding your Mortgage Rate
Finance experts say that many consumers tend to just look at the end figure, not at the rate. Once they have settled into a monthly figure, they tend to forget that rates change and just look towards paying off the loan diligently every month. In a survey of 1,000 participants last 2014, 35% had no idea what their mortgage rate was. Many were not even sure when they bought their house or when they re-financed it. They simply relied on their broker who would typically say, “This is a good rate.”
However, did you know that a simple half percent point or even a quarter percent point variance can make a huge difference in your budget and savings?
Should You Consider Refinancing?
According to banking and finance experts, everyone with a mortgage should start checking the current online mortgage rate quote or talking to their lender about refinancing. They say this because the long term interest rate has dropped below 4% to 3.8 as the time of writing this.
In terms of savings, if you applied for a mortgage with a 4 to 4.25% rate which was the rate for the past 3 to 4 years, then by refinancing with a lower rate, you can re-route the savings towards another expense like saving for a vacation, buying a new car, or increasing your retirement nest egg. You can enjoy a better lifestyle and look forward to a less stressful time budgeting your income provided you avoid signing up for a refinance loan with a fixed rate.
Being Financially Savvy with the Instant Online Mortgage Rate Quote
If you’re worried that working on refinancing is a step backwards, you are looking at the situation from a negative point of view. Refinancing does not necessarily mean you are tight for money. It’s a financing tool available to everyone with a loan whether it is a mortgage, credit card loan, or auto loan. Once rates go down, grab the opportunity to save money!
With the lessons learned from the mistakes made during the housing boom, lenders and banks will no longer consider 100% financing. The most lenders will consider is 80% which is why 20% is the basic and lowest down payment for a property today. Thus, the loan-to-value cap has changed significantly. So go ahead and try the instant online mortgage rate quote to find out if you could enjoy considerable savings this year and up to the end of your mortgage period!
Other Reasons You Might Want to Refinance
There are other reasons refinancing makes sense. Here are a few:
- Is your current rate adjustable? Then it’s time to shift to fixed rate especially now that the rate is low. You will get to enjoy a stable rate and not have to worry about inflation.
- Refinancing will allow you to consolidate loans under a lower rate.
- Find a better lender to do business with if you are unhappy with your current one. There are a number of people who just don’t like their lenders and the hassle it takes to transact with them. This is the perfect opportunity to change your set-up and find a friendlier lender.
- If you have had changes in your personal life like divorce, a death in the family, you can use refinancing to fix the documents and lower the mortgage at the same time. A parent can even opt for cash-out refinancing to help a child with a foreclosure threat or other money problems.
It’s time to get an instant online mortgage rate quote. Think about it as a diagnostic test. There are no strings attached and it is free and online.
