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Last updated on February 2nd, 2021 at 06:12 pm
Just days after a report said nearly 18 million U.S. homeowners have good reason to refinance, now new data shows many mortgage holders are missing out on major savings.
the Mortgage Bankers Association reported that In spite of the mortgage rates slipping down and making refinances look more attractive, the refinance loan applications have gone down 7%.
Mortgage refinancing slows even as rates keep falling. In the week ending July 31, overall mortgage applications collapsed down to 5.1%.
Joel Kan, the trade group‘s chief forecaster said: “Refinance activity decreased — despite the decline in (mortgage) rates — but the current pace remains more than 80% higher than a year ago when rates were over 4%.”
The mortgage bankers put the current average for 30 year fixed rate mortgages at 3.14%, an all-time low in their weekly survey.
Other reports indicate rates are even lower to 2.81%.
Comparison shopping is good practice when you’re renewing your homeowner’s insurance, so to get a refi loan lower than 3%, you need to shop around remember that mortgage rates can vary from one lender to another.
Black Knight, a mortgage data firm reported an estimated 17.8 million homeowners are sitting on higher-rate mortgages that are apt for refinancing and could save them an average of $287 a month.
Which means up to $5.1 billion in monthly mortgage savings is going unclaimed.
You can apply for a refi if you have a 30-year loan with a rate that could be slashed by at least three-quarters of a point (0.75) meaning from 3.70% down to 2.95%, only thing is you need to have a credit score of 720 and up and 20% equity in your home, Black Knight said.
Homebuyers — whose applications for “purchase” mortgages were down 2% last week — are finding that low rates are a good counterbalance for rising home prices, and help keep monthly payments down.
Experts say it is a good time to weigh the costs of taking out a new loan against the likely savings, to decide whether a refi is right for you, especially when the mortgage rates are lowest ever.
Reference Source: Yahoo Finance
