Mortgage Rates Back to April Lows

Back in April, I refinanced my mortgage. The timing was good. I caught a low point. The rates went up subsequently. I just noticed the rates have dropped back to the same levels again.

If you missed the April lows, now you have another chance to start calling for refinance rates. The benchmark rate for 30-year fixed should be 5.0%, no point. For 15-year fixed, it should be 4.5%, no point. Those are the rates I see at the lender I used last time. If your current mortgage rate is higher than the rates for a no-cost refi, refinancing will save you money from day one.

I will start watching the rates. If the rate drops another quarter percent, I will refinance again.

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  1. baronpilot says

    I’m in the early stages of doing a refi. I’ve got a lock at 4.25%, 15 year fixed. My fees are going to be between 2500-3000, not counting prepaid interest.

    I’ve got 13 yrs 4 months left to pay on my existing 5.5% 15 yr fixed mortgage, about $210K. Figuring $3K in fees, re-financing at 4.25% will save me $21.4K if I keep my payments the same. I’ll pay the loan off in 12 yrs 3 months. That $21.4K is all interest, of course. So, Uncle Sam takes about 30% of my savings in taxes. He’s gonna need it.

    I’ve become WAY too interested in what’s happening with 10 year Treasuries. Two weeks ago they hit a yield of 3.5%, and this past week they hit 3.15%. All the while the rates have been stuck at 4.25%, though fees have lowered. I guess the 10 yr treas is too volitile to affect the mortgage rates, or the banks have just locked elbows and they are holding at 4.25%

    My loan is $210K, so 0.25% equals $4,500 in interest over the 12.5 year payback period.

    Rates are being kept low by the Fed’s buying program for MBS. That was just extended but ends in March. Economic fundamentals of a government running deficits and printing money (a necessary thing, IMHO) will combine with the end of the Fed buying MBS’s to push up rates. I think current rates, and rates for the next 45-75 days, are probably the lowest that will be seen in along time.

    Re-fi now, or Re-fi never is my opinion.

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