WASHINGTON - The average rate on the 30-year fixed mortgage this week fell below 4 percent for the first time ever, to 3.94 percent. For those who can qualify, it's an extraordinary opportunity to buy or refinance. And mortgage rates could fall even further now that the Federal Reserve plans to reshuffle its portfolio of securities to try and lower long-term rates. The average rate on a 15-year fixed loan, a popular refinancing option, dipped to 3.26 percent, also a record. Mortgage rates have tumbled because they tend to track the yield on the 10-year Treasury note. A drop in mortgage rates could provide some help to the economy if more people could refinance. A homeowner who owes $250,000 and is paying 5.09 percent on a 30-year fixed mortgage - Refinancing the loan at 3.94 percent could save him or her more than $2,000 a year. Story here.
The raw deal is, the people who need this the most are not able to take advantage of it. Like me for instance. I bought my house in 2007 for a reasonable price with a 6.78% 30 fixed. Fast forward to today where my home value has been cleaved in half, my wife left me, and no raise in income. I still pay my bills, but like many others in my situation its getting harder and harder to justify staying in my home. The biggest relief would be to refinance my mortgage to a much lower rate saving a few hundred a month that I could spend on a newer car or furniture. But that is impossible for the majority of people with underwater mortgages. I would need tens of thousands of dollars just to be eligible for a refinance. But if I had that kind of money, I wouldn't need to refinance. Until the government figures out how to fix this problem, the economy is going no where.
So you are getting excited about saving very little money on a already outrageously overpriced, bank owned home? A home in which, more than likely, you will be paying off your entire life and probably die before it is ever even 'yours'?
The raw deal is, the people who need this the most are not able to take advantage of it. Like me for instance. I bought my house in 2007 for a reasonable price with a 6.78% 30 fixed. Fast forward to today where my home value has been cleaved in half, my wife left me, and no raise in income. I still pay my bills, but like many others in my situation its getting harder and harder to justify staying in my home. The biggest relief would be to refinance my mortgage to a much lower rate saving a few hundred a month that I could spend on a newer car or furniture. But that is impossible for the majority of people with underwater mortgages. I would need tens of thousands of dollars just to be eligible for a refinance. But if I had that kind of money, I wouldn't need to refinance. Until the government figures out how to fix this problem, the economy is going no where.
Darthmatt
pretty much in the same boat... bought in mid-2007. home value prob down ~25% since then...
So you are getting excited about saving very little money on a already outrageously overpriced, bank owned home? A home in which, more than likely, you will be paying off your entire life and probably die before it is ever even 'yours'? chandlerr_360
entire life? die before it's yours? if you aren't going to live another 30 years then what secondly would you rather rent and give someone else almost as much as your mortgage would be?
So you are getting excited about saving very little money on a already outrageously overpriced, bank owned home? A home in which, more than likely, you will be paying off your entire life and probably die before it is ever even 'yours'? chandlerr_360
[QUOTE="chandlerr_360"]So you are getting excited about saving very little money on a already outrageously overpriced, bank owned home? A home in which, more than likely, you will be paying off your entire life and probably die before it is ever even 'yours'? topsemag55
FYI, my home is paid off.:o:lol: Well, FYI, your in the minority. Then again I can only assume that you are 40+ and are in the top 15% of 150k+ jobs or married with a wealthy wife :P
they have to do something. out of the 10 houses on my street 4 of them have been abandoned.
i drive through the subdivision and it seems like a ghost town.
my house is probably worth $20,000 less than what i paid for it 7 years ago.
bummer i didn't stay in the apartment until now, you can pick up a house for a song these days.
Riverwolf007
Old couple nextdoor to mine, wanted to sell their house cuz they want to move to a retirement home place, nobody wants to buy.. no one has the money, no jobs no money.
I thought 2010 was a time to buy! I got a 4.4% and all the people who bought years ago almost had a heart attack when I told them the rate. The housing market is just plain scary right now, But there's still something nice about having a key on the ring that opens up the doors to a home you own.
So you are getting excited about saving very little money on a already outrageously overpriced, bank owned home? A home in which, more than likely, you will be paying off your entire life and probably die before it is ever even 'yours'? chandlerr_360
I take it you're not a fan of home ownership which is fine. But to say that the interest rate drop will save you very little money is absurd. Like I said in the previous post my interest rate is in the 4's, I just looked at a mortgague calculator and I would save 130 a month with that new rate. For someone like the poster, i thin his name was darth something, who said his rate is almost 7 A new loan at the new rate would be the equivalent to the greatest financial gift he ever got. He would save tens of thousands over the course of the loan, not to mention having 200-300 extra every month to help him get by. I hope he gets a chance to refinance as it seems its been a little rough for him for a little while, good luck to him and everyone else caught up in this mess
It is not a good time to buy for me, will still saveweezyfb
It never a good time to buy, it seems.. house prices go up when the economy good, but house prices down when the economy bad which can't find a job any where.
I'm in the process of buying a house right now! It's cheaper for me to "own" this house than it would be to rent. And I will be making payments towards something that I will eventually own where as renting, my money is wasted.
[QUOTE="chandlerr_360"]So you are getting excited about saving very little money on a already outrageously overpriced, bank owned home? A home in which, more than likely, you will be paying off your entire life and probably die before it is ever even 'yours'? Jandurin
entire life? die before it's yours? if you aren't going to live another 30 years then what secondly would you rather rent and give someone else almost as much as your mortgage would be?I agree. So what if I never pay it off anyways:? it would be the same as renting...
This isn't healthy, they're doing the opposite of what they should be doing during a recession. Interest rates should be going up, not down. There will be consequences.
The benefits people in debt have been receiving the last couple of years; is at the expense of everyone else. Not just savers, but the cost of living has been going up for everyone; because of the lack of interest rates to suck in excess money supply. If this keeps up, consumers won't have enough disposable income to grow the economy. Inflation will have eaten into their wages, increasing the costs of food and energy.
A lot of people are going to lose their homes when rates go up. And they will go up, they have to, you cannot keep them at these historical lows forever.
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