According to a recent CNBC news article, the 30-year fixed rate mortgage rate has dropped to 4.15% for potential homebuyers with at least 20% to put down on a new home. This affects conforming loan balances up to $647,200. The rate decrease has created a surge in mortgage refinances.
This led to a 9% increase in refinance applications between the first and second week of March 2022. Prior to the interest drop, mortgage rates rose steadily for months. However, the Ukraine crisis fueled high demand in the bond market. As a result, yields fell, and mortgage rates also dropped.
A Window for Those Who Want To Refinance at Low Rates
Are you in the market to refinance your home? If so, now might be a great time to do so. Reach out to the dedicated team at Potempa to take advantage of unexpectedly low refinance rates.
In conjunction with the decrease in interest rates, points remained unchanged at 0.44 for home buyers with at least a 20% down payment. That’s still 83 basis points higher than one year ago. However, it creates a window for homeowners seeking lower rates through refinancing their homes.
Concern over disruptions in oil and commodities, related to the conflict in Ukraine, is likely to spur higher inflation in the coming months. Therefore, taking advantage of this window and lower rates may be a good idea for homeowners paying high-interest rates on their original mortgage.
Advantages of Refinancing Your Home Mortgage
There are advantages and disadvantages to refinancing your home. Many homeowners want to save money on higher interest rates when they signed their original mortgage. So, even small drops in the percentage can save you hundreds or thousands of dollars per year.
Other homeowners refinance to get a lower monthly payment and a more favorable payment schedule. When you refinance, you can change your payment schedule. Taking advantage of lower rates may give you more money to pay off your loan sooner. Additionally, you can also access your home’s equity through a refi with a cash out option.
Do You Have an Adjustable-Rate Mortgage?
If you have an adjustable-rate mortgage, now might be a great time to refinance to a fixed rate. Otherwise, you may pay significantly higher monthly payments if interest rates rise. In order to get started with your mortgage refinance, reach out to our team of dedicated bankers with any questions you may have. We’ll find the best rates and mortgage refinance products for you.
We also handle home loans for first-time homebuyers. It only takes a few minutes to receive a pre-approval if you have good credit. If you’re worried about lower credit scores and other challenges, meet with one of our bankers today to see what options are available to you!