Mighty Bargain Hunter

Time running out to refinance?

June 10th, 2005 | by mbhunter |

On msn.com today I saw the headline that stated that mortgage rates are at a 14 month low. Also, Alan Greenspan stated that the economy was doing well. This may mean that the Fed will continue its measured hikes on the overnight lending rate. So I was wondering if time was running out to refinance my mortgage.

Originally (in 2001) I took out a 30 year fixed rate mortgage. Rates have gone down so much since then that I may be able to refinance to a 15 year mortgage with only a slight increase in my payment. This would save me tens of thousands of dollars on interest.

You may be able to afford to reduce your term as well unless you took out your mortgage very recently — in which case, congratulations! — or if you don’t want to reduce the term on your mortgage, you can refinance with the same term and possibly decrease your payment.

Bankrate.com will give you a list of local lenders and the current rates they’re charging for a number of different types of mortgages. If you enter in the amount that you want to refinance, it will also give you a monthly principal plus interest payment. You can get also get offers from lenders directly by going to LendingTree Mortgage Refinance Loan (which I did tonight) or you can also get up to 4 free refinance quotes from leading lenders & save $1000s on your mortgage by checking out LowerMyBills.com.

There will likely be some refinancing fees and possibly points (one point is 1% of the refinanced amount) that you need to pay. Also your mortgage interest deduction on your federal income tax return will go down a little bit (if you itemize) because you’re not paying as much interest. The reduced tax break will always be less than the interest savings you will get, though.

If the Federal Reserve continues to increase its overnight lending rate, eventually this will filter into the consumer mortgage market. So if you’ve been thinking about refinancing, you may want to do it soon. If you want to run the numbers and play around with your payment amount and see how it plays out over time, go to Bret Whissel’s Amortization Calculator and plug and chug.

Questions tagged credit-card at Cash Commons:

• Anybody have sucesss with 0% Balance Transfers on Credit Cards?
• When entering credit card information on a website, does the billing address have to be correct?
• Two of my credit cards got hit with fraudulent charges the same day. What gives?