Here is a quick thought for everyone who does not need to refinance their house: you should look into refinancing your house. To the extent you are going to have debt on your home, now is a great time evaluate details of that debt. Rates are ridiculous in the grand scheme of things.
I just had a client lock a 30 year fixed rate mortgage for 4.50%. He felt very good about his current rate in the mid to high 5′s until he saw 4.50%. He was one of those people who had been ignoring what has been going on with mortgage rates because he’d had no need to refi and his rate was relatively low from a historical perspective. What he realized this week was rates just got a lot lower, again. He is being opportunistic knowing rates may never be here again in his lifetime. Pretty sharp move that will save him money monthly and over the long haul. It’s worth noting that many times the smartest financial decisions are not motivated by necessity, but rather by wisdom. Flexibility is scarce when necessity gets involved.
The reason I’m addressing this to those who don’t need to refinance their house is because those are the people who are more likely have enough equity in their home where the painful appraisal they will likely get won’t kill the deal. In this economic environment the appraisal of your home is a tough document to read. It may even make you mad. But resist the temptation to throw the appraiser under the bus, he/she is walking a very tight line trying to satisfy what the regulatory bodies are expecting of the banks. This is why everyone is not refinancing their house; according to current appraisals a ton of people are underwater on their home. Tough to qualify if you are upside down. But hang in there, this is temporary. The value of your home will gain ground again over time. Unfortunately by that point rates will be in a different place.
Take a Second Glance at the Rates
But back to my original suggestion; if you have tuned out what is happening in the mortgage market thinking you were set, it is worth taking another look. I’m not a mortgage banker or an appraiser, but I don’t think these rates will hang around for long. This time next year things may look very different and you may be wishing you had snagged that mortgage rate that starts with 4. Woodstock has plenty of good locally headquartered resources that can help you evaluate your specific situation. Find someone you can trust and crunch some numbers. You may find it is well worth the effort.
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