If you are thinking of refinancing your home or buying a new home, there is no better time than right now to lock in a low mortgage rate. That is because rates for both purchase and refinance mortgages are near historic lows, which means you could save a lot of money by applying for your loan today, before rates begin to rise. Interestingly, recent data from the Mortgage Bankers Association show consumers have been slow to lock in rates this spring - a move that could wind up costing you tens or even hundreds of thousands of dollars over the life of your loan.
Lock in Now for Greatest Savings
Mortgage rates tend to rise and fall based on the economy as well as the guidance from the Federal Reserve Bank, which meets regularly to review interest rates and decide if it is time to raise them or lower them. Currently, the rate has a range of 0.25 percent to 0.5 percent, which means there's very little chance the rates will go down. But based on the growing strength of the economy, there is a much better chance rates could go up - and that means locking in a rate now is critical.
Beyond historically low rates, there are other great reasons to lock in now. Mortgage lenders are offering some pretty amazing deals to home buyers and homeowners who want to refinance, including low closing costs and a wide range of point options to help rates stay as low as possible. Refinancing an existing mortgage can be a really smart financial move, especially if your current rate is a point or more above current rates. The savings from refinancing can be even more substantial if you plan on staying in your home for several years or more.
Finding the best mortgage product for your needs takes a little research, but our rate tables can provide you with a good starting point. Just remember: When comparing mortgages for a new home purchase or to refinance an existing mortgage, be sure to compare all the same variables - not just rate, but the length (or term) of the mortgage, the points you will need to pay upfront and other closing costs. Only by comparing "apples to apples" can you make sure the mortgage you are getting is the best for your needs. Another tip: Be realistic about what you can afford. When rates are very low, it can be tempting to take out a bigger mortgage than you really need. Know the amount you need, and stick to it. Take a few moments right now to visit the rate tables and learn more about the low rates being offered by leading lenders. Then take the next step and lock in your rate. Considering an average mortgage can affect your finances for the next 30 years, it could be one of the wisest financial moves you will ever make.