By The Dream Digs Team, February 13, 2020
By Aaron Nawrocki, Capital M Lending
With fears of the Coronavirus spreading and affecting the global economy, investors are taking their money out of equities and putting them into fixed income securities. That has driven Treasury and spurred a mortgage interest rates drop. Currently, mortgage interest rates are at a three-year low. They also reached a 49-year low for the month January. It’s not just that rates have fallen, it’s that they’ve fallen so precipitously. Today’s average 30-year fixed rates in the mid 3’s are fully 1% less than average rates 12 months ago.
Meanwhile, Portland’s real estate market has stayed strong, with values continuing to rise. This combination of increasing values and current interest rates drop means that many homeowners could benefit from refinancing.
Here are some key reasons to refinance:
- Lowering your interest rate and monthly payment
- Shortening the term of your mortgage to minimize the total interest paid
- Removing or reducing mortgage insurance
- Consolidating debts – first and second mortgage or consumer debts
- Taking equity out for home improvement or repairs
Generally, refinancing will involve closing costs built back into the new mortgage. That means that it’s important to keep the new mortgage long enough to recognize a financial gain. We like to see homeowners recovering their closing costs within 12-18 months. The short recovery period makes it more likely that refinancing would be a financial “win” even if it was not the homeowners’ forever home.
When rates decline quickly, we typically see them stay at their lows for 3-5 weeks before they rebound – so this could be a unique opportunity. If you purchased your home in the last three years and owe more than $250,000, it may pay off to refinance to today’s lower rates. Depending on your home and situation, an appraisal may not be required. If you’re interested, reach out to us and we’ll get you numbers to review. The only input we’d need is a copy of your most recent monthly mortgage billing statement. For more information on the current interest rates drop, feel free to give me a call at 503-445-9525 if I can be of assistance!
Aaron Nawrocki has over 20 years of direct experience overseeing mortgage and loan processes, working to provide clients the market insight and lending expertise required to make informed decisions
THE DREAM DIGS TEAM
Aryne + Dulcinea, Earth Advantage Principal Broker | Earth Advantage Broker | ADU Specialists | OR
The Dream Digs Team are full-service, high-producing agents, who know how to navigate the unique challenges facing the Portland real estate market...
Read More
- T: 503-380-5124
- aryne@livingroomre.com
