Mortgages in the US record prices dropped

Фото: Depositphotos

Unpredictable changes in the global economy and sluggish US economic growth may be good news for homeowners who want to refinance their mortgage loans. They are currently dealing with the lowest 30-year fixed mortgage rate.

On average, in the country, the 30-year fixed mortgage reached a three-year low and this week was 3,78%. For comparison, four weeks ago, the 30-year flat rate was 4,05%.

The stakes are approaching a historic low, said SHS vice president Keith Gambinger. He is sure that the time has come to refinance if you have not done so in the past few years, since the rates are unlikely to drop even lower.

However, there are a few cautions that, in the opinion of Keith Gambinger, must be taken into account before refinancing.

1. Do not forget about your costs when refinancing

These include bank charges, legal fees, valuation fees and insurance fees. Suppose that refinancing expenses amount to 2% of the loan amount. In this case, refinancing does not make sense if you plan to stay in your home for another five years. To refinance, you also need a reliable credit history and regular work.

2. Use a special calculator to calculate

On the Internet you can find a lot online calculatorsthat will help you calculate the benefits of refinancing your loan. This needs to be done in order to understand how much time it will take for you to get the benefit, taking into account the new loan rate and refinancing commission. However, keep in mind that most online calculators do not include mortgage deductions.

3. Choose the best offer on the market

Loan rates and commissions in different institutions may vary significantly, so you should carefully look around. If you have a good credit history, you can get a better rate at a local savings bank than at national banks or from mortgage brokers.

4. The maturity of your loan will increase

Refinancing will entail an inevitable increase in the maturity of the loan, so that you can end up spending even more money on it, despite the reduction in the monthly payment. A reduction in the loan repayment period, on the contrary, will lead to an increase in the monthly payment.

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