Just since the mortgage rates are at record lows right now doesn’t mean that the U.S. housing market is getting any better. As the real estate market is so slow, and mortgage rates have gone down considerably, most are more able to find opportunities in the market. Having a lower interest rate will helps many be willing to take that step of losing some money to hopefully do better in the long run. People are taking a loss on their current homes, trading up and coming out ahead. Others are learning that spending their own cash to refinance mortgages is one of the safest investments to make these days.
Mortgage rates and also the housing market
You’ll end up with a lot more money if you listen to the economists within the Wall Street Journal who suggest trading up homes or refinancing your home you’ve now. Better homes are accessible to anybody who’s willing to make the sacrifice with their mortgage. And with mortgage rates so low these buyers can keep their monthly payments manageable, although the new homes are more expensive.
Cash in or cash out
Typically, people refinance to “cash out” some of the equity they’ve built up in their homes over the years so they can use the cash. Oddly enough, more people are interested in “cash-in” refinancing, as outlined by the Los Angeles Times. With savings accounts and other investments yielding little or nothing in profits these days, it makes sense to move that cash into a home, especially if it knocks a point or two off the mortgage rate. In 2009’s fourth quarter, a 3rd of everyone who refinanced their mortgages put money into it so their principal was lowered drastically.
Smart real estate investing
Numerous want their mortgages to be gone. Totalmortgage.com looks at it as all the money saved is really money that is now earned and can be spent. One who pays off their mortgage as soon as possible is then more likely to have some additional money laying around to spend on other things or other investments. Real estate investing like that is a breath of the outdoors these days. Other borrowers are taking advantage of record-low mortgage rates to refinance from 30-year fixed mortgages into shorter-term mortgages (15 or 20 year fixed). Doing this, one can conserve thousands of dollars and will even have lower monthly payments a lot of the time.
Wall Street Journal
online.wsj.com/article/SB10001424052748704421304575383490870014662.html?mod=WSJ_hpp_sections_personalfinance
Los Angeles Times
articles.latimes.com/2010/jul/11/business/la-fi-lew-20100711
Totalmortgage.com
totalmortgage.com/blog/mortgage-rates/low-mortgage-rates-afford-unique-housing-opportunities/5198
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