30 Year Mortgage Hits Record Lows.......Should you Refinance?

Freddie Mac stated yesterday that the 30 year mortgage fell to its lowest rate in 37 years. (Since they started tracking the rate).  The rate dropped to 5.19% from 5.47% a week ago. This time last year the rate was 6.14%. According to bankrate.com average monthly rate we are at 5.28%, and the record low for there 10 year index was  4.88%  

 

 

 

 

It might be a little early for most people, but if this trend does continue it will certainly be worth looking at more closely. The rule of thumb is: if you can get a rate that is 1% less or more you should refinance.   It makes a lot of sense since you will have costs such as closing costs and a pre-payment penalty. 

 

Remember your situation can be different (always double check the rules of thumb!) depending upon the costs and actual rate you are quoted. Here are a couple of great calculators for running the #’s. 

 

http://www.dinkytown.net/java/CAShouldIRefi.html 

 

 http://www.bankrate.com/brm/calc_vml/refi/refi.asp

 

For rates also check out:  http://www.amerisave.com/  They are showing rates as low as 4.25%.

 

Don’t forget to check out our courses at www.mywealth.com where we can continue to give you great insights in regards to your finances.

 

Bob O’Brien

Sr. Instructor