Mortgages and Refinancing

By: Ashley Conroy Email
By: Ashley Conroy Email

But some mortgage experts say not everyone qualifies for these great rates.

You might be thinking about refinancing and reducing your monthly payment. But first, think about this.

"Are you trying to save monthly? Are you trying to retire your mortgage a lot sooner? Or are you trying to do a combination of both?" said Bo Smith, a mortgage financing expert.

Smith says often people shoot for both. But the reality is refinancing isn't always the best option.

"And that may not necessarily add up for a variety of reasons," Smith said. "One of which, their loan amount is not that large; number two, they haven't had much principle reduction pay down over 5 years."

But for those who think they will benefit, Smith recommends to have as much information as possible, such as your mortgage statement, a monthly payment breakdown, your taxes and insurance information, and whether your loan is FHA or conventional.

"Because when they communicate that to a mortgage officer, those are some of the questions immediately upfront that mortgage officers are going to want to know, to see if there truly is a net-tangible benefit," said Smith.

And if there is a benefit, mortgage buyer Freddie Mac reports record low rates at 4.32 percent for a 30-year loan and 3.83 percent for a 15-year loan.

But before jumping on these records rates, Smith has his last piece of advice.

"Just understand that, you know ,today is not yesterday. It's a different environment," said Smith. "And so we're going to ask for a lot more than we did in years past. And that sometimes is not channeled out effectively to everybody."

Applications increased by almost 3 percent from people looking for lower rates. But the Mortgage Bankers Association reports this wasn't enough to pull the housing market out of its slump since.

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