Potential homebuyers all seem to have the exact same question: How much interest am I going to have to pay on my mortgage? With the economic downturn a few years back, there is the rumor that now is a “buyers' market” and that rates are as low as they’ve ever been. But how low are they? And how can homeowners take advantage of these rates and save money?
Potential homeowners have the process of getting a home loan pretty much set out for them; Find a home, shop around with different lenders, and go with the lender that can offer the best rate and terms on a home loan. There is really no other way to do it, with the exception of some FHA insured loans, and those are only for people who qualify.
The real question, however, is what if you already own a home? How can you save money in this economy? People who bought homes several years ago may be paying some of the highest interest rates of all time. According to HSH.com, housing interest rates were one to two percent higher a few years ago than they are today. A two percent rise in interest rates can mean over $25,000 extra in interest payments over the life of a home loan. Many people want to take advantage of the new, lower mortgage refinance rates and refinance their homes to save all this money.
First off, you need to decide if you would benefit from a refinance. You can find some of the best tips on things to consider by visiting Consumer Reports and reading some of their tips and things to think about before refinancing. Second, be realistic. You can’t expect to get a certain rate until you shop around and see what the industry standard is. For help on what to expect, check out Daily Breeze and their helpful information on staying real. Finally, shop around, don’t rush! Different lenders can offer you different rates. If you rush to sign with the first lender, you may be missing out on an even better rate with a different company.
Start educating yourself on home refinancing by reading the articles linked above. Then start looking! Don’t be afraid to shop around and say no to lenders who may be pressuring you to sign. Remember that you are looking for yourself and you are the one who will benefit the most.