Refinance Sunday – Mortgage Rates Under 4.9%
Posted on | March 29, 2009 | 2 Comments
Each day we see news headlines such as the following “The Lowest Mortgage Rates in 50 Years.” While these headlines are true, things are a little bit different this time around. Mortgage rates are in fact under 4.9% but it is much harder to lock in at these historically low rates. In today’s housing market you must have a spotfree credit report and over 20% equity in your home to be considered for these low rates. If you do not fit into this category, your refinance rate will drastically increase.
Each and every lender is advertising that they are providing mortgage rates under 4.9% but does this really matter if you do not qualify? The advertised rate could be 2.25% and it would not matter if the only individuals who could qualify for them need an 840 credit score and 75% equity in their home. While this is a bit drastic, it proves my point. In today’s housing market, many homes have lost significant value due to the struggling economy. You may not realize it, but your home may be 40% less in value than it was a the peak in your housing market.
Unfortunately there is very little you can do about this. The one thing that could help you get a lower rate is to work on improving your credit score. If you have a balance on any credit cards or a student loan, now might be the time to pay them off to improve your credit score which in turn may get you a better mortgage rate. It is a catch 22 as credit card and loan rates are also at an all time low so it might not be beneficial to you to pay them off if your rate is under 4% like many Americans.
Ultimately, you never know if you will get a refinance rate under 4.9% unless you try. Check with several lenders and ask some of your friends who have recently refinanced. Each market is different so you may be able to get a rate at 4.5%! Each Sunday I write a column on refinancing so make sure to check it out weekly. Bookmark the link below for easier access to the content.
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March 29th, 2009 @ 1:22 pm
[...] Read the original: Subprime Blogger / Refinance Sunday – Mortgage Rates Under 4.9% [...]
March 29th, 2009 @ 3:31 pm
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