“Now might be the time to REFINANCE” was the title of an article printed Sunday, April 19th in the Northwest Florida Daily News. The article featured the Carnley family from Crestview, FL. They recently refinanced their home from a 6.5 percent interest rate to a 4.875 percent rate. And perhaps the most interesting part – they’ve only owned their home since September of last year! That’s right; they owned their home for less than 6 months before they started the ball rolling on their refinance. Obviously, just about anyone is a candidate for a refinance right now.
The national Mortgage Bankers Association said that right now almost 80% of all loans being closed in the U.S. are for refinances. Indeed interest rates are the lowest we’ve ever seen as a nation, and aren’t likely to get any lower. Occasionally someone tells me they’re going to wait for rates to get a little lower. I wonder (but never actually say of course!) “Do you have a proven track record of successfully timing the market?” Yeah, right! Realistically, if they are so good at timing the market, why do they have a mortgage on their home at all? In reality no one knows where the bottoms or the tops of market cycles are going to be. If so, that individual should have sold their home in mid 2005, rented since then, and should only consider purchasing again when the market bottoms out (of course only they know when that is – or was). Jim Baker, of Baker and Lindsey Mortgage in Fort Walton Beach was quoted in the article as saying “Rates are at an all time low. If you can get a deal right now, don’t wait for a better deal tomorrow”. In other words, “a bird in the hand is better than two in the bush” and I agree!
The biggest question isn’t really if interest rates are as low as they’ll go, but instead whether you should refinance at all. Carole Carnley (the lady in the article) said “I think so many people are afraid, but Steve Schutt (my partner here at Superior Home Loans) really walked us through it and made sure we did what we were supposed to do…” Some mortgage originators or loan officers will gladly take your application and refinance your home without ever providing professional advice; some will even calculate a break even point for a refinance by dividing the monthly savings into the total cost and telling you how long you’ll need to own the home to realize actual savings. A professional like Steve (or me) is equipped and trained to enter your current financing scenario into a software application combined with proposed options to generate a Total Cost Analysis. This TCA takes all the guesswork out of the decision by giving you the total cost of all options (including doing nothing) over time taking into account your tax bracket and other investment accounts. Wouldn’t you rather make a decision based on real, calculated numbers than on the sales ability of a commissioned salesperson, especially if they’re in a massive call center answering hundreds of phone calls ever day?
If you like millions of others are considering a refinance, I encourage you to contact us so we can provide our Total Cost Analysis for you. Working with someone not equipped to provide a TCA is (in my opinion) simply irresponsible. And if you don’t even investigate the opportunities available for refinance, you may kick yourself later on. If you could save thousands through a refinance, and see your net worth increase more rapidly over time, isn’t that worth a quick phone call?
How can we help you? We’re providing a professional approach to mortgage finance!