A Few Thoughts on Your 2017 Mortgage Situation

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Filed under: Market Comentary

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We’re now in month two of 2017 (hard to believe)!

If financing a home is on your to-do list for 2017, here are a few things you may want to keep in mind.

Should you still consider buying a home?

Buying a home is “still a solid gold for many” and borrowers looking into buying should understand that it is still attainable. However, with higher interest rates, affordability will be a concern, especially when the focus is on being about to make your mortgage payment and continuing to save your hard-earned dollar.  Do whatever is necessary to keep your credit score as high as possible to get the best mortgage rate possible.

Should you refinance in 2017?

This actually depends on your current loan situation.   These conditions, however, may present an opportunity for you…

Cash-out refinancing: This can be a smart and careful move to rid yourself of high payments on lines of credit, student loans, and credit cards that are typically associated with consumer debt. Your mortgage payment may rise, but you may save money per month on other debt you have.

Shortening your loan term: Going from your 30-year fixed mortgage to a 15-year fixed mortgage can save you a good chunk of money. The interest rates for a 15-year and 10-year fixed mortgage are lower, and you have the opportunity to pay off your mortgage in full while planning for your retirement.

Refinancing in order to drop your mortgage insurance:  If you are currently paying mortgage insurance but have built up some equity in your home, you may have the opportunity to refinance and drop that premium from your monthly payment.  This could save you hundreds or even thousands of dollars per year.

 

A few other things to think about for the year ahead…

If the stock market continues to improve and rally, you can expect mortgage rates to continue to climb.

Pay attention to any news from Fannie Mae or Freddie Mac. If rates continue to increase, current underwriting standards might be adjusted to meet the needs of the decreasing housing market.

If something big and unexpected occurs to cause the market to reverse its current course, which may lower interest rates, keep a watchful eye on the rates and try to act quickly.

Got questions?  Need assistance?  Want to get an objective analysis of your current mortgage?  Just give me a call, I’m here to help.

 

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