Keep Your Eye Focused on Treasury Bond Rates To Adjust Your Current Mortgage RatesMortgage rates typically are based off the current rates of treasury bonds. Most lenders set their long term mortgage rates in line with 10 and 30-year treasury rates. The reason that they do this is quite simple. Treasury rates are the rates that are used as an index to represent what the future value of money will be by the secondary market and investors. The Federal Reserve Bank will issue these bonds along with an interest rate that it will pay to holder of the bond once it matures. The market, in reflecting economic and inflationary predictions, adjusts the yields. Mortgage rates are then set according to the yields. If the market expects that thing in the future are going to be good with low inflation then the mortgage rates will be lower. If the market forecasts higher inflation then the mortgage interest rates will also rise. This is something that is very important to look upon by consumers because it will directly affect their bank account. In most cases, a home is the single largest purchase that someone will make in their lifetime. Home loans are usually very high in their term, sometimes as long as 30 years. The amount of interest paid over the the life of the loan can be staggering even for lower cost homes. For example, if you finance a $100,000 home for a term of 30 years at an 8% interest rate, the amount of money you will spend on interest alone will be $164,153.60 giving you a monthly payment of $733.76. If you could lower the interest on your mortgage by just 1% you would save $24,645.60 over the term of the loan and would pay $665.30 saving you $68.46 each month. As mortgage rates rise you want to lock in your interest rate to protect you against future increases however if the rates are falling then you may consider refinancing to save you more money. Some people ask when is the best time to refinance your home because there is a cost to refinancing. Typical costs include appraisal fees, document preparation fees and up front points to pay. It is not always in your best interest to refinance for small rate changes. So the question is how much more will the market continue to move lower and what would be the best time to consider refinancing? This goes back to keeping an eye on treasury bond rates. When you see long term treasury bond rates start to take a dive after long periods of being high then it's time to get focused on the current mortgage rates. Once the stop diving then you may consider refinancing to lock in a better rate for your mortgage allowing you to put more money back in to your pocket! Shannon Moran is the owner of http://www.the-best-in-loans.com which provides great information on all types of loans such as automobile loans, mortgages and student loans. There is also information on finding a great mortgage company in reference to the article above. Publishing Rights: You may republish the above article for use on your website, in your newletter or ebook as long as you agree to leave the article, author's signature and all links completely intact.
MORE RESOURCES updated Fri. March / 29 / 2024 Refinancing - Learning Center Zing! Blog by Quicken Loans Types of Mortgage Refinance Options Bankrate.com Discover Home Loans Review 2024 - Mortgages Business Insider How to Refinance Your Mortgage NerdWallet Will Mortgage Rates Go Down in 2024? What Homebuyers Should Expect Business Insider Mortgage Interest Rates Today, March 28, 2024 | Rates Are Down This Week. Will They Stay That Way? Business Insider Underwater Mortgage: What To Do Bankrate.com Mortgage Refinance Rates: Compare Current Rates Business Insider When to Consider Refinancing Your Mortgage Business Insider Mortgage Interest Rates Today, March 27, 2024 | Rates Down Slightly as Homebuying Season Ramps Up Business Insider 30-year refinance rates: What to know CNN Underscored The best mortgage lenders for refinancing in March 2024 CNN Underscored 15-Year Mortgage Refinance Rates: Compare Current Rates Business Insider Mortgage Relief and Mortgage Assistance Programs [2024 ] The Mortgage Reports Current mortgage refinance rates CNN Underscored Mortgage demand falls again HousingWire Should You Refinance Your Mortgage In 2024? Bankrate.com Best Mortgage Refinance Lenders In 2024 Bankrate.com Current mortgage interest rates: Mortgage rates today CNN Underscored Refinance Requirements: What You Need to Refinance Your Home in 2024 The Mortgage Reports When to Refinance Mortgage: Is it Time? - Buy Side from WSJ The Wall Street Journal Conventional Refinance Rates and Guidelines for 2024 The Mortgage Reports How Soon Can You Refinance a Mortgage Loan? 2024 Rules The Mortgage Reports How To Refinance An Underwater Mortgage Bankrate.com How Soon Can You Refinance a Mortgage? NerdWallet Current 15-year refinance rates — and lenders that offer them CNN Underscored Mortgage Rates Chart | Historical and Current Rate Trends The Mortgage Reports Can You Refinance With No Income Verification in 2024? The Mortgage Reports Best Refinance Lenders of March 2024: Refinance Your Mortgage The Motley Fool What Credit Score Do I Need To Refinance? Bankrate.com Should I Refinance My Mortgage Now? When to Refinance As Rates Drop Business Insider Office of Research blog: A look at cash-out refinance mortgages and their borrowers between 2013 to 2023 Consumer Financial Protection Bureau How To Get Equity Out Of A Paid-Off House Bankrate.com The Sales Pitch for an 8% Mortgage: Buy Now, Refinance Later—for Free The Wall Street Journal CFPB Releases Study of Refinance Mortgage Loans Between 2013 and 2023 Consumer Finance Monitor Should You Refinance Halfway Through Your Mortgage? Bankrate.com Mobile Home Refinancing | Loans & Rates 2023 The Mortgage Reports Mortgage Rate Forecast February 2024 Bankrate.com How To Refinance Your Car Loan In 6 Steps Bankrate.com
|