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Holy cow! Look at those mortgage rates

Posted Dec 19 2008, 06:41 PM by Karen Datko
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A story at USA Today -- "Mortgage rates at 37-year low: Average 5.19% for 30 years" -- disrupted our partner blogger J.D. Roth's vacation reverie. All of a sudden, J.D., who's not an impulsive guy, is thinking about refinancing his home.

He checked Bankrate.com and found a low rate of 5.085%, which would reduce J.D.'s payments to $1,111 and save him $275 a month. But wait. It could get even better, he wrote in a post at Get Rich Slowly.

A company that advertises at Bankrate listed a mortgage interest rate of 4.25%. "A 4.25% 30-year mortgage? My jaw dropped. Literally. Could this be real?" wrote J.D., whose mortgage is at 6.25%.

Yes, the mortgage market looks wonderful for those who can qualify to refinance. Reader "Jason B." wrote to J.D. about a problem that was unheard of not so long ago. The reader is refinancing and locked in at 5.25%. Now he's paid another $300 application fee to lock in at 5.0%. Since then, he wrote, "the rate has dropped to 4.875% and could go even lower!"

What should J.D. do? At last count 71 people had chimed in with their two cents.

Related articles:

The other side of the rock-bottom mortgage

Time to refinance is now

4 reasons not to refinance

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Comments

 

Nice for those that can do it.  I can't refinance.  I owe 165K and appraisal came in at 85K (4K less than what we paid in 2001).  Values have plummeted in this area.  I'm stuck with an adjustable rate that tops out at 13%, going to 9.5% next month.

Jenny (Posted 12.19.08 8:24 PM ) Report Abuse

I'm refinancing right now at a rate of 4.625!  It's going to save us $125 per month.

Liz (Posted 12.20.08 9:35 AM ) Report Abuse

Hi Liz, I am considering refinancing.. If you don't mind me asking, how much did you pay to refi?

Tony (Posted 12.20.08 12:07 PM ) Report Abuse

JD should wait. Rates will come down further, IMHO. My credit union was offering 4.75% on a 30-year-fixed mortgage as of yesterday (Friday). M'hijito and I refinanced a six months ago and got what we thought was a pretty smokin' improvement on what we were paying for the Investment House he and I are copurchasing: 5.3%. It costs something to refinance, and so it's in your best interest to wait until rates really have bottomed out.

Of course, in this wacky economy, who would imagine things could get any worse? Still, my cloudy crystal ball says wait another two or three weeks (at least) and see what happens.

Funny about Money (Posted 12.20.08 1:42 PM ) Report Abuse

We have had a 5.3% mortgage for several years, having refinanced twice.  We began at 9.25%, went to 7.5 then to our current 5.3.  Our payment, including taxes and insurance is $700, AND it's a 15 year fixed rate mortgage.  Can't hardly find a decent apartment for that price.  What a difference a lower rate can make.  Rates would have to drop below 4% to make it worth another re-fi as the fees are rather steep.  

SteveTheHawk (Posted 12.20.08 8:22 PM ) Report Abuse

Our family decided this year no gifts. All the grandkids are grown so we decided to send the money that we would have spent on to a family that needed it. Some decided to help my granddaughter who is in college and plays soccer there. Her coach who she has known for many years has been newly diagnosed with ALS, also known as Lou Garrigs disease, and his insurance does not cover all the medicine that he needs. I feel that this is what Christmas is all about and I am so proud of my grandaughter.

Jo Crews (Posted 12.21.08 12:11 PM ) Report Abuse

Years ago my family decided to stop exchanging gifts.  It seemed it had just become exchanging gifts cards because people often didn't like the gift they got and had to exchange it.  We decidedeven that was insane.  Instead, we get together as a family every Christmas enjoy each other company, have a good meal, fun games, good conversation and we are all less stressed and enjoy the day much more.  We do get a gift for the young children to open, but even limit that.  

Lynn S. (Posted 12.21.08 3:50 PM ) Report Abuse

Considering the Banks are almost at zero and it use to be a 3% difference of what they paid verses what we paid........why the heck is everyone boosting about 5%, they need to do alot better then this to get this moving again!

Kathy (Posted 12.22.08 1:33 PM ) Report Abuse

Is anybody doing no-doc loans anymore?  We would love to lower our rate but financed no-doc summer 07

Laura (Posted 12.22.08 3:30 PM ) Report Abuse

Any lenders in Maryland offer low rate Refi

Harry (Posted 12.22.08 3:39 PM ) Report Abuse

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