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Old 03-10-2009, 08:43 PM
 
210 posts, read 1,049,656 times
Reputation: 288

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Mortgage experts,
Do you think mortgage rates are going to continue to drop? Why or why not? In what timeline?

I'd like to take advantage of the low rates and refinance my current 6.25%, 30yr fxd. I got an offer for 4.875%, 30 yr fxd with 0 points. This seems good to me. My loan officer is convinced that rates will not get much better than this--but this may be because he wants his commission. Who knows?

But if rates are likely to drop even further in the next month or two, obviously I'd rather wait and get a better deal. At the same time, if this is as good as it's likely to get, I don't want to miss out from waiting too long.

How low can rates possibly get?
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Old 03-10-2009, 09:07 PM
 
3,576 posts, read 6,168,969 times
Reputation: 1432
Quote:
Originally Posted by Mentat View Post
Mortgage experts,
Do you think mortgage rates are going to continue to drop? Why or why not? In what timeline?

I'd like to take advantage of the low rates and refinance my current 6.25%, 30yr fxd. I got an offer for 4.875%, 30 yr fxd with 0 points. This seems good to me. My loan officer is convinced that rates will not get much better than this--but this may be because he wants his commission. Who knows?

But if rates are likely to drop even further in the next month or two, obviously I'd rather wait and get a better deal. At the same time, if this is as good as it's likely to get, I don't want to miss out from waiting too long.

How low can rates possibly get?
That's a very good rate. What are you waiting for?

Mortgage rates dipped to their lowest level in early Jan 2009 and have gone up since than. Than it went down a little bit again. Its very unstable at this point.

But 4.875% fix with zero points refinance is excellent. I'm sure 95% of people will agree with me. My sisters both locked in a 4.875% but each paid 0.7 points for higher loans more than 500K in the Wash DC area. So you are getting a good deal.

What exactly are you looking for. Are you looking for 4.5% with zero points?

You have to remember we are in a slight period of deflation right now.

Banks just can't give people 4% fixed mortgages because there will be massive inflation when the economy stabilizes again.
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Old 03-11-2009, 12:46 AM
 
Location: Sacramento
2,568 posts, read 6,088,193 times
Reputation: 1919
Quote:
Originally Posted by Mentat View Post
Mortgage experts,
Do you think mortgage rates are going to continue to drop? Why or why not? In what timeline?

I'd like to take advantage of the low rates and refinance my current 6.25%, 30yr fxd. I got an offer for 4.875%, 30 yr fxd with 0 points. This seems good to me. My loan officer is convinced that rates will not get much better than this--but this may be because he wants his commission. Who knows?

But if rates are likely to drop even further in the next month or two, obviously I'd rather wait and get a better deal. At the same time, if this is as good as it's likely to get, I don't want to miss out from waiting too long.

How low can rates possibly get?

I would be more concerned with how much the house will appraise for.
We are currently applying with ING Rates at a Glance and I will not stop worrying until the appraisal comes in.

What is you LTV going to be? Are you going to have to pay PMI?
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Old 03-11-2009, 07:15 AM
 
210 posts, read 1,049,656 times
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Quote:
Originally Posted by suzie02 View Post
I would be more concerned with how much the house will appraise for.
We are currently applying with ING Rates at a Glance and I will not stop worrying until the appraisal comes in.

What is you LTV going to be? Are you going to have to pay PMI?
When we bought the house in 7/08, it appraised for 575K, but we paid 535K. The mortgage is 255K. Therefore, the LTV is approximately 48%. Since we already got it below market value, I am hoping it won't appraise for less than 535k, since house prices have held up pretty well where I live. There won't be any PMI.
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Old 03-12-2009, 08:46 PM
 
210 posts, read 1,049,656 times
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FYI, the rate went down again to 4.675%.
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Old 03-12-2009, 10:15 PM
 
Location: DFW - Coppell / Las Colinas
34,671 posts, read 38,353,449 times
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I just locked in a 15 year mortgage on a home we are building at 4.375% Wow !
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Old 03-12-2009, 11:41 PM
 
262 posts, read 896,963 times
Reputation: 216
Personally, I'd go ahead and lock if you get a rate below 5. I got quoted 4.875% a few months back and didn't think twice about locking. It's a good thing I did because the rates never got lower than that before I purchased my house.
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Old 03-13-2009, 08:17 AM
 
Location: Visitation between Wal-Mart & Home Depot
8,308 posts, read 35,088,303 times
Reputation: 7116
Quote:
Originally Posted by Mentat View Post
Mortgage experts,
Do you think mortgage rates are going to continue to drop? Why or why not? In what timeline?

I'd like to take advantage of the low rates and refinance my current 6.25%, 30yr fxd. I got an offer for 4.875%, 30 yr fxd with 0 points. This seems good to me. My loan officer is convinced that rates will not get much better than this--but this may be because he wants his commission. Who knows?

But if rates are likely to drop even further in the next month or two, obviously I'd rather wait and get a better deal. At the same time, if this is as good as it's likely to get, I don't want to miss out from waiting too long.

How low can rates possibly get?
I'm assuming for explanation that your balance is $250K. Re-financing to 4.875% (paying closing costs of about $4500 out of pocket) will reduce your payment by a little under $200/month. Your payout for the closing costs would be slightly under 2 years. That definitely makes sense. You are going to feel pretty stupid if you miss 4.875%, I would jump all over that.

If that isn't very compelling, consider that the total interest paid over 30 years on a 6.125% loan would be about $70,000 more than a loan at 4.875%.

One thing to consider - if you have less than 20% equity in the house you will probably have to pay PMI. The amount is usually pretty small, but I hate just giving money away to a bank and once you are paying PMI it can be difficult to get out from under it.

Play around with this mortgage calculator. Run all the numbers and see what makes the most sense. Karl's Mortgage Calculator
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Old 03-13-2009, 08:40 AM
 
163 posts, read 617,371 times
Reputation: 85
I am a first time home buyer, and trying to close on a house in less than 2 weeks now, and I got locked in at 5% and I am pretty happy since alot of people i know have rates of 6.5 or 6.75 from over a year ago so its a huge difference I think.
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Old 03-13-2009, 09:34 AM
 
Location: Visitation between Wal-Mart & Home Depot
8,308 posts, read 35,088,303 times
Reputation: 7116
Quote:
Originally Posted by bls8195 View Post
I am a first time home buyer, and trying to close on a house in less than 2 weeks now, and I got locked in at 5% and I am pretty happy since alot of people i know have rates of 6.5 or 6.75 from over a year ago so its a huge difference I think.
You're doing quite well. I got in at exactly the wrong time with my first home and am currently refinancing a 6.875% loan. The funny thing about it is that my parents would have loved to have had a 6.875% interest rate on their first home. People were paying rates as high as 14% back then.

5% or less is great.
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