Mortgage Rates - What Banks Don't Want You to Know
Mortgage rates are always a concern before buying and after having purchased as the great economic wheel turns with its ups and downs. It's important to get the best deal possible in addition to taking the important necessary first step of getting pre-approved before going house hunting.
What about those who have already purchased and not satisfied with their current mortgage rate? Or those that have an ARM wondering about mortgage rate increases? Mortgage rates are low now, but rates may not stay that way if the Government changes its economic policy.
Low Rates for Refinancing and New Mortgages
Many buyers simply don't realize you can put down less than 10% on a home, and there are many types of loans that incorporate some form of down payment assistance and somewhat dependent on where you buy.
Tip: If you inquire about any property on our site, just ask about incentives or what's available for that area for low down payments or assistance.
Tip: Many buyers mistakenly believe you have to put down 10% or more, not true. FHA loans are only 3.5% down, and offer the same low mortgage rates available today.
But what about low rates? Yes, rates are still shockingly low, and even decreased further this month but don't expect them to stay that way. It's good news for today's buyers, but for those that have already bought a home HARP is a great program, but may only be available for a few more months. Savvy home owners that have already taken advantage of this once-in-a-lifetime program have already saved upwards of $5,000 a year. If your mortgage is less than $625,000 the odds of qualifying for the program are good and allows loan to value ratios of 80% - 125% accommodating a large percentage of home owners.
For more insights into financing, Miranda Imperi of Union Home Mortgage has a lot of helpful posts on our blog.
The program was originally designed to help America's middle class, the reasoning behind it to stimulate the economy. If banks can keep the middle class at the higher rates of years gone by, naturally they stand to make much more revenue, but if homeowners are saving more money is naturally being spent, boosting the economy via home owners' ability to spend.
If you're thinking about refinancing, now is the time, before the HARP program disappears. Banks continue to apply pressure on the Government to reverse this program. How much could a home owner actually save? The difference between 6% and 3.5% on a $200,000 is tens of thousands over the life of a loan.
Assuming a 3.5% down payment, a 6% loan, would be $1,157.13 for principal and interest only on a $200,000 loan, whereas 3.5% interest on the same loan would be $866.66, or, a savings of $290.47 per month, $3,485.64 a year, saving $34,856 in the next 10 years.