Low interest rates keep mortgage lenders busy as people flock to refinance homes

While COVID-19 continues to affect the job market, it plays a whole different role in the housing market.

Mortgage lenders remain busy with people flocking to refinance their homes. This is mainly due to historically low interest rates allowing people to save money in these uncertain times.

Average interest rates were around three to five percent nationwide in the spring of 2019. Today they have fallen to nearly two percent.

Brandon Caruso, vice president of loan operations for Today Lending, which specializes in refinancing, says the current low rates could be a way to save money. “It’s a great opportunity, probably once every ten years,” Caruso said.

Uncertainty continues to be a recurring theme among banks across the country. “In order to make it a little more attractive to people, they lowered the rates,” Caruso said.

However, there are some things to consider before jumping on the bandwagon. The life of a loan will be reset if you refinance. So if you’re close to halfway on a 30-year fixed loan, don’t. Another potential downside are all the costs associated with refinancing.

“You’re still going to expect a little bit of closing costs, maybe a reassessment,” Caruso said. “So you need to make sure your home is ready and ready for an appraisal.”

Here’s how refinancing can help save you money. If you pay 4% on a $ 130,000 house, you will pay $ 620.64 per month. If you refinance at 2.9%, you’ll pay $ 541.10 per month. In total, you will save around $ 80 each month.

To find out how much you could save, CLICK HERE for a free refinance calculator.

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