Provided courtesy of: http://www.mortgagenewsdaily.com/consumer_rates/
Mortgage rates moved higher at a pace that was probably quicker than the average homebuyer would like yesterday. That was part of a 4 day move leading back up from the lowest levels in more than a year (or close to them, depending on the lender). That 4-day move could have easily been quite a bit longer, and it still could be, as long as we overlook today's market movement. Thankfully, it's taken rates back in a friendlier direction.
At issue is the unexpected flare-up in British politics surrounding Theresa May's referendum gambit yesterday. To be fair, the gambit was unexpected, but the flare-up makes perfect sense. Long-story short, if May is ousted (and that seems likely), it creates uncertainty surrounding a major economy and financial center. It also makes a "no-deal" Brexit more likely, which is generally seen as detracting from European economic growth prospects. All other things being equal, lower economic growth coincides with lower interest rates....(read more)
Mortgage rates had a fairly decent day yesterday as far as most lenders are concerned. A few lenders saw fit to bump rates up in the afternoon following a day of weakness in the bond market (which directly affects the rates lenders can offer). Because a majority of lenders did NOT make that mid-day adjustment, they were always likely to do so with today's first rate sheets--especially if bonds didn't improve overnight.
Not only did bonds not improve today, but they weakened a bit more. This made lenders' decisions easy. With that, the average conventional 30yr fixed quote moved back up to levels last seen on May 9th and 10th. In outright terms, some loan scenarios will be an eighth of a percentage point higher in rate while others will merely be looking at a reasonably big bump in closing costs (certain upfront costs can be increased in lieu of higher interest rates, depending on the lender)....(read more)
Mortgage rates moved microscopically higher today, depending on the lender. In terms of underlying movement in the bond market, however, rates should have risen a bit more than they did. This has to do with the timing of the bond market weakness and the amount of movement lenders typically want to see before changing their mortgage rate offerings for the day. Simply put, weaker bonds suggest higher rates, but bonds didn't weaken fast enough for most lenders to see their "re-price" threshold.
All of the above means that most lenders continued to offer rates that were very close to the lowest levels in more than a year. Only a handful of days have been any better, and all of them have occurred in the past 2 months....(read more)
A refinance occurs when a business or person revises a payment schedule for repaying debt. Mechanically, the old loan is paid off and replaced with a new loan offering different terms. When a company refinances, it typically extends the maturity date. Companies or individuals refinancing loans may have to pay a penalty or fee.
BREAKING DOWN 'Refinance'
The most common forms of consumer debt are mortgages, car loans and student loans. The borrower agrees to make certain payments based on a rate of interest. Companies operate the same way. The most common types of corporate loans are term loans, bonds and lines of credit. The company agrees to the terms of each loan type, and the bank lends it money. Terms provide the details of the loan and specify the interest rate, payment amount and payment date(s).
When the terms of the loan are revised in a way that changes the payments associated with the loan, the loan has been refinanced. In a refinanced loan, the old loan is paid off with the new loan, and the old terms are replaced with new terms. Some loan terms come with fees associated with prepaying, which makes refinancing less rewarding. The most common changes in loan terms are maturity date and interest rate.
Borrowers refinance for a myriad of reasons. A common goal is to pay less interest over the life of the loan. Borrowers may also want to change the duration of the loan or switch from a fixed-rate to an adjustable-rate mortgage, or vice versa. The reasons and motivations behind refinancing a loan are as varied as the loan types offered.
Refinance Loan Types
There are several different types of refinancing options. The type of loan a borrower decides on is dependent on the needs of the borrower. The most common type of refinancing is called the rate-and-term. This occurs when the original loan is paid and replaced with a new loan. Another type of refinancing is the cash-out. Cash-outs are common when the underlying asset collateralizing the loan increases in value. The transaction involves withdrawing the value or equity in the asset in exchange for a higher amount. In other words, when an asset increases in value on paper, you can gain access to that value with a loan rather than selling it. This option increases the total loan amount but gives the borrower access to cash immediately while still maintaining ownership of the asset. Another refinancing option is referred to as the cash-in. The cash-in refinance allows the borrower to pay down the loan for a lower loan-to-value ratio or smaller loan payments.
Like many other Americans, you may be considering using the equity you've built in your home to re-invest in your dreams or consolidate debt. A mortgage refinance allows you to borrow additional money on your mortgage, so you can afford the things you've always wanted. It will also help save you money and help consolidate your debt into one convenient payment.
Mortgage refinance can prove beneficial in several ways:
We help you decide whether it is the right time for you to refinance. The decision to refinance should be carefully evaluated to avoid any complications at a later stage. By carefully studying the status of your current mortgage and comparing it to your income and other debts, we help you pick the refinance solution that best suits your current financial status.
We offer some of the lowest and most competitive mortgage refinance rates in the market. Regardless of your requirement, whether it is to consolidate existing mortgages or obtain a better rate, we get you the best deal possible. Our experienced mortgage professionals, who have extensive knowledge of the mortgage industry, will provide the necessary guidance that you need in making the right refinance decision.