Today in my finance group, everybody was raving about the new home loan rates. They swear that they have hit rock bottom, although several months ago they hit under 2%. They began the steady incline up to 3%, but this week they have a dropped down. Many of the people in the group boast about lowering their rates to save more money, but my question is, are the new rates worth it, how do the increases in home value compare, and what are the current housing market benefits?
Home Price Increases
Just looking at the uptick at home prices today made me want to sell my house. A home that I bought for under $140,000 is now worth over $200,000, according to Zillow estimates. This represents an almost $80,000 uptick in price that made me want to sell immediately. The only thing holding me back is home inventory in my area is low. What’s the point of selling if you have nothing to move into? Alongside that, the home prices are overinflated in many areas. The homes I looked at cost more than mine but were more outdated. In those cases, which is for most people, instead of selling and purchasing a new home, you may want to ask for a refi.
Interest Rates and Refinancing
Today’s interest rates for a 30-year and 15-year mortgage are between 3.04% and 2.35%. Some lenders are offering even lower rates. When looking to refinance it is best that you comparison shop. Because I have an FHA loan, I usually go with a streamlined FHA process. I start with the company that currently services my mortgage and then work my way down the list. People rave about the Costco refi rate, but the last time I refinance I went with Rocket Mortgage. They had the better deal at the time, but I am sure there is a wide selection of companies for you to choose from out there.
It’s best to shop around with several different companies to see who has the best rate and costs you less in points and closing fees. Be sure to have the lender break down each part of the pricing chart for you. Sometimes it can be overwhelming, as the disclosures and other documents contain a lot of confusing numbers. You want to make sure that you are being charged fairly at a comparable rate and that you understand cost implications. With the housing market soaring and inventory low, it may be a great time to tap into the housing market benefits of a refi.