Dropping Mortgage Rates!

Mortgage interest rates have been slowly declining for some time now and this week has been the lowest they have been in quite some time! With that being said, we are getting more calls regarding refinancing. (NOTE: Please refer to another recent post that touches on what to consider when contemplating a refinance. ) Most of these calls are from people that either need to withdraw cash from their home or people who need to get locked into a fixed rate and escape from their ARM.

When considering cash out make sure you look at the deal from all angles. What are your goals? Will this new loan help me meet that goal? Do I really want to amortize a particular debt over 15, 20, even 30 years? Will my situation be different if I consolidate or are the same variables still in place for me to run up the debt again? These are all crucial things to think about, especially in this market. People who have been using their home as a piggy bank are finding out the hard way that it isn't as easy anymore!

ARM's are the hottest topic right now. Many are resetting now and others have a few years left. It is a no brainer to refinance into a fixed loan if yours is resetting now, but what do you do if you have a couple years left? This is a tougher question. You can do 1 of 2 things. Hold tight and take advantage of the super low rate for the remainder of the term or refinance and take the low rates that are available NOW! Neither option is wrong. Your situation will dictate what is right for you. If you are unsure, just think about what rates are now and how much lower you think they could get? Lower rates are possible, but I can't imagine any drastic rate cuts.
You will be sick if you get burned with raising interest rates in 2 years when you could have locked in at 6% or 5.875% now! All because you waited to take advantage of your 5% ARM rate. Rates could be the same in 2 years or they could be higher! Nobody knows. By no means do I pretend to be someone who can forecast rates. These are just things to consider while you are trying to decide what action is best.

Just realize that regardless of all the negative press out there, the mortgage market is still alive and kicking. Rates are good and there are numerous products to fit your specific need. While the industry has had a bumpy ride and has tightened up this past year, don't get the impression that you cannot get a loan! As long as you are working with a lender that you trust and is known for doing quality work, you will be taken care of and placed with a great product!

Brought to you by:
Professional Mortgage Group, Inc.
"Your Columbia, MO Mortgage Broker"