US real estate updates: Mortgage refinance rates lowest in years
The US government is giving homeowners another year to refinance their loans under a little-used program designed to help borrowers whose homes have plummeted in value. The Obama administration’s Home Affordable Refinance Program will now run out on June 30, 2011. The program allows borrowers who owe up to 25% more than their homes are worth to refinance to lower interest rates. It was originally projected to help 4 million to 5 million homeowners with loans owned or guaranteed by Fannie Mae and Freddie Mac. So far, it has helped around 220,000, according to the Treasury Department report in early March.
Many homeowners in the United States who are struggling with their mortgage payment are looking for refinancing, mainly, to a 30-year fixed rate mortgage, so they can lock in a lower monthly payment over the life of their mortgage.
Mortgage refinance rates continue to drift down this past week. For example, average 30 year mortgage refinance rates are down to 4.91 percent, down from an average 30 year refinance rate of 4.95 percent earlier this week. Average 15 year mortgage refinance rates are also lower - 4.32%, down from a rate of 4.35 percent earlier this week.
Interest rates are low and there are a variety of refinancing options available and lenders compete hard on the market. Borrowers need to look at lenders that may be able to offer the best rate, but most importantly, borrowers need to be sure they are on a firm financial foundation before they proceed with refinancing.
Lenders' offers
Bank of America refinance mortgage rates have stabilized at a low level between 4.7% and 5% for the entire year of 2010. It looks as if this trend is going to continue into April. On March 20 we are see 30 year fixed mortgage rates around 4.75% while 15 year fixed mortgage rates are coming in around 4.15%.
Wells Fargo also offers low rates for refinancing their home loan both in terms of interest rate and of lowering monthly mortgage payments. This week, a 30 year fixed mortgage rate is around 4.8% while the 15 year fixed mortgage rate is about 4.3%.
CitiMortgage, the mortgage servicing branch of Citigroup, offers homeowners and new homebuyers a low mortgage rate on their home loan as low as 4.75%. Even a homeowner refinancing or buying their first home that couldn’t get that rate have still seen mortgage rates around 5%.
What to expect
All mortgage lenders have greatly benefitted from this low mortgage rate environment by gaining new customers looking to buy a home or refinance. But how long this is going to last?
The current low interest rate environment has lasted over 17 months but the US Federal Reserve Bank remains adamant about keeping interest rates low for an extended period of time. The next few months will be very interesting as the Federal Reserve Bank plans to stop purchasing mortgage backed securities which could push mortgage rates higher.
- HARP: A new way forward on housing in the United States?
- Bank of America reports $1.2bn loss
- Analysis: Mortgage lending – a solution for constructions sector’s recovery in Moldova
- Obama administration offers a new program to help homeowners in danger of foreclosure
- More help for homeowners in U.S. to avoid foreclosure (video)
- Mortgage refinancing applications in decline in the United States
- Bank of America bold steps to reduce mortgage debt, foreclosure
- Moldovans to buy dwellings under First House programme
- PM: Greece will not default, will refinance its debt
- US real estate updates: Mortgage refinance rates lowest in years
- Asia, US helps Mercedes Benz sales hit record high in 2006
- Cricova: The Largest Underground Wine Cellar in the World
- What does Remortgage mean?
- Dutch bear profit rises 26 percent
- Foreign direct investment in India doubles during 2006
- Greece: Socialist government's budget deficit of 12.5% caused debt crisis
- Toyota in talks to build new China plant
- Walt Disney profit up 39 percent
- DaimlerChrysler is not planning to manufacture trucks in India