Low Rates Refinance

Colin Delaney May 13, 2012

Rates Low for Costa Mesa Real Estate

I get lots of people asking me if it makes sense to refinance their homes with today’s rates. My question back to them – what’s your situation? How long until you pay off the mortgage? Do you plan on staying in the home for a long time? Can you benefit from a reduced payment?
 

Low Rates Refinance

 
Every situation is different for Costa Mesa real estate owners. Rates as of today are about 3.75% for a 30-year fixed mortgage under $417,000 loan amounts, and about 4% for those with loans under the higher conforming limit of $625,000.
 
Here are some quick thoughts from the California Association of Realtors, and they make a lot of good points for Costa Mesa real estate owners:
 

When to refinance again

Those who refinanced their mortgages a year or so ago can benefit from Low Rates Refinance when interest rates averaged just below 5 percent for a 30-year fixed-rate loan, may be wondering whether it’s time to refinance yet again now that rates are at least a full percentage point lower.
 
  • As of Thursday, according to Freddie Mac’s weekly survey, the average rate on a 30-year loan was 3.83 percent, down from 4.63 percent a year ago, setting a record low.
  • According to financial planners, homeowners considering refinancing first should delve into their financial goals, specifically the length of time they plan to live in the home.
  • Some homeowners decide it makes more sense to stay with their current mortgage, especially if the savings are small or they plan to move within a year or two. According to one financial planner, when homeowners refinance, they’re not building equity; they’re starting at the beginning of the amortization tables.
  • Amortization schedules work like this: In the first few years, almost all of the payment goes toward interest, so the longer the homeowner has the loan, the more is put toward the principal.
  • Those who refinanced in the last year or two don’t have to consider amortization tables, but they do need to know their equity position – and when refinancing would begin to pay off.
  • To calculate that, start with a rundown of all the closing costs, then divide the closing costs by the amount expected to be saved on each monthly payment.
  • Depending on the lender, most Costa Mesa homeowners likely need to have at least 20 percent equity, and maybe a little more, if they want to wrap closing costs into the new mortgage.
Need help? Want to know what might be the best thing to do? I don’t do mortgages but I would be happy to give you a bit of advice for your situation. I also have lender partners that I can refer you to for the best rates.
 
Colin Delaney – – – (714) 743-9882 – – – E-mail me

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