By S.E. Slack
According to financial experts, most Americans will refinance every three to four years. So is it time to look at your home mortgage?
Whether you’re looking to purchase a home in the City of Angels or refinance the one you have, low interest rates make this a good time to talk to a lender or mortgage broker about the potential for saving money on your mortgage.
In Norwalk, average year-over-year list prices have dropped nearly 8 percent for a median list price of $115,000. In Wakeman, however, list prices are up more than 19 percent over a year ago to an average of $154,900. Increases like that can offer homeowners the potential to save money.
“The majority of people refinance to save on interest, save money monthly or shorten their term,” said Vince Reece, mortgage loan originator with Plum Creek Funding. “Anyone currently in an adjustable-rate mortgage should consider looking into a fixed-rate mortgage. With a fixed-rate, your payment will not change and you have the security of knowing what your payments will be each month.”
Adjustable-rate mortgages change within specific time frames established by the loan. If that’s occurring currently in your loan, it’s a particularly good time to check into whether or not a fixed-rate mortgage can save money, Reece said.
Credit scores can also play a big factor on rates. Applicants whose credit score has gone up since the last time they applied for a mortgage loan might be able to take advantage of today’s lower interest rates.
“Many times you can combine a first and second mortgage into a 15-year fixed rate mortgage and keep payments close to what’s being paid now. That kind of approach can save you a ton of interest,” Reece said.
The current value of a home might also allow homeowners to eliminate private mortgage insurance, further reducing payments. Across Ohio, year-over-year home values have improved 3.1 percent for an median home value of $105,300.