Is it time for homeowners to refinance?

Is it time for homeowners to refinance?

Consumers considering a home refinance should begin the process now, according to mortgage experts at, a leading resource for free, objective and expert money advice. Further, the company reported that the most frequently asked question of its “Ask Bill” expert advise center concerned home refinancing rates and recommendations.

“Market conditions have aligned to make this a perfect environment for home refinancing,” says Ethan Ewing, president of “Low rates and compelling opportunities to refinance into shorter term loans have arrived at the same time as large consumer demand.”

“Ask Bill” is a free service that allows consumers to ask any money question of human experts and receive personalized advice to their inquiries. One of the most frequently asked questions of 2009 concerned interest rates for home refinancing.

This high level of interest on behalf of consumers corresponds to favorable market conditions for refinancing. Specifically, these factors include:

  1. Interest rates continue to hover around all-time lows, making it sensible for anyone carrying a higher-rate interest loan to consider refinancing. With some exceptions, a half point to a one-point drop in rate will generally make refinancing worthwhile.
  2. Low, fixed-interest rates make converting from an adjustable rate loan to a fixed 15 or 30-year loan a smart move. Even if the adjustable payment is currently lower than a fixed-rate payment, when rates rise again, the monthly payment on an adjustable rate loan will quickly leapfrog a fixed-rate loan.
  3. The current difference between a fixed 15-year and 30-year interest rates is significant, making refinancing into a shorter-tern loan a compelling opportunity. This can save hundreds of thousands of dollars over the life of a loan and shorten the time to payoff with sometimes only a slight increase in monthly payment.
  4. FHA efficiency mortgages provide consumers with an opportunity to refinance into a loan that will help pay for home efficiency improvements. These loans are meant to provide consumers with a way to make energy efficient improvements to their home as part of an origination or refinancing. This is a great way for homeowners to cost-effectively lower their utility bills through basic home repairs.
  5. Those homeowners whose equity situation has steadily deteriorated, leaving them with little, no or negative equity in their homes, should ask their lender or broker for help. Most have some flexibility with government programs aimed at reducing rates for homeowners in weak equity positions.

“This interest rate environment provides opportunities for those trying to escape high interest rates as well as those making savvy, long-term financial decisions,” says Ewing. “Anyone considering a home refinance should move quickly to lock in rates now” RE

© RISMedia’s REAL ESTATE Magazine. March 2010


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: