Mortgage Rate Tips

03.22.2008 | 10:33 am | Mortgage Rates

I was reading the follow article from Fox Business News and it had a few tips / advice regarding refinancing or negotiating a mortgage rate:

…if you’re looking to refinance your mortgage and have the ability to wait, you may be better off sitting tight for a couple more months. He expects the housing market to improve in the second half of the year and once credit markets return to a state of normalcy, lending conditions should improve.

For people with home equity lines of credit, they should see a benefit from the Fed rate cut, noted Weiss’s Larson. Since home equity lines of credit are tied directly to the prime rate, which is the interest rate banks charge their most credit-worthy customer, Weiss said those lines of credit almost always fall in lockstep with the federal fund rate. Larson did note it takes a month or two for the rate you’re paying on your home equity line of credit to catch up…

…“I locked my loan at 4.5% in January, the day after the Fed cut,” said Epstein. “The banks are still figuring it out and are more willing to bargain.” Epstein said that if you don’t get a 1% decline in your mortgage rate, it’s not worth refinancing because of the closing costs associated with a mortgage refinancing. And if your credit score is less than 688 at the most, the harder it is to get that loan, she said.

And according to Reuters the good news is slowly spreading down to the mortgage rates:

U.S. 30-year mortgage rates fell to an average of 5.87 percent from 6.13 percent a week earlier, while 15-year mortgages averaged 5.27 percent compared to 5.60 percent last week.

I am hanging in until I can refinance my mortgage again.

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Fed Drops Rates Once More

03.18.2008 | 2:38 pm | Mortgage Rates

So the Fed has dropped the Fed Funds rate by 3/4 of a percent to try to “stablize” the credit markets.  The wierd thing about this it appears to help the banks more than us consumers.  As the banks are trying to make more money on the spread between mortgage rates and the rate they need to borrow at.

What ever happened to those days that when the Fed drops the rate the mortgage rates would follow?  Not in today’s market.  But it does help stem the tide of even higher rates.  I stink at predictions but why do I get the feeling that rates will continue to drop…

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