Insight

“Interest”-ing: Low Rates and Refinancing

“Interest”-ing: Low Rates and Refinancing

Roy D. Oppenheim

Roy D. Oppenheim

August 16, 2019 11:31 AM

Trade Tensions and Stock Scares:

In yet the latest escalation of trade tensions between China and the United States, this past weekend President Trump announced America will impose a 10% tariff on $300 billion of Chinese goods and China responded by suspending its purchase of US agricultural productsand lowering the value of the yuan, its currency, to its weakest point since May 20, 2008. The increased retaliation from both countries, coupled with the Federal Reserve bringing interest rates down last week, caused the Dow, a major stock market index, to plunge 900 points and saw the S&P 500 and NASDAQ, also major stock market indices, off by around 2%.

Mortgage Implications:

Late last week, these factors made investors flock to the relatively steady bond market, which pushed the yield on the 10-year Treasury down sharply, resulting in lowered interest rates. According to Mortgage News Daily, the average rate on the popular 30-year fixed mortgage hit 3.70% on Friday, the lowest value since November 2016. That rate will presumably lower, as bond yields drop even more.

Simply put, last week’s drop means that over 8 million people who have a 30-year mortgage could qualify for a refinance and even save at least 0.75% off of their current interest rate by doing so. There are several components to contemplate before deciding to refinance.

What to Consider:

A recent CNBC article looks over three factors when analyzing whether refinancing a residential or commercial mortgage makes sense: the ability to earn back investment, the seasoning of the loan, and the impact refinancing will have on other financial goals. Once those points are considered, looking towards the ways to refinance is important as well.

For instance, residential and commercial property owners can refinance using a conventional loan. With property values increasing in many areas, the amount of equity (the difference between your current mortgage and the current market value of your home) one has also increases, which makes it easier for you to refinance. Others can determine whether an FHA (Federal Housing Administration) loan is more suitable, because even if you have little or no equity in your home, a low credit score or higher debt than most lenders generally accept, the FHA guarantees that private lenders will be repaid should you default, which means banks and private lenders make loans that they ordinarily would not at competitive rates that can substantially cut your monthly payments. Furthermore, millions of veterans, as well as those in the National Guard, active duty members, and the reserve, are eligible to refinance with VA (Department of Veteran Affairs) loans.

Here to Help:

At the end of the day, taking advantage of low mortgage interest rates remains an “interest”-ing option for many people. As stated by Ben Grabsoke, president of Black Knight Data and Analytics, “Lower rates have also increased the buying power for prospective homebuyers looking to purchase the average-priced home by the equivalent of 15%, meaning that they could effectively buy $45,000 ‘more house’ while still keeping their payments the same as they would have been last fall.” In other words, increasingly favorable rates allow consumers to both refinance their mortgages and purchase affordable homes, which is definitely something to keep an eye on.

From the Trenches,

Roy Oppenheim

Oppenheim Law | Real Estate Attorneys

2500 Weston Rd, Suite 404
Fort Lauderdale, FL 33331
954-384-6114
https://www.oppenheimlaw.com/

Originally posted on South Florida Law Blog: “Interest”-ing: Low Rates and Refinancing https://southfloridalawblog.com/interest-ing-low-rates-and-refinancing/

Tags: mortgage, mortgage interest rates, mortgage rates, refinance, refinance using a conventional loan, stock scares, Trade Tensions

Related Articles

Marriage, Mortgages, and Millennials


by Angelica Rolong Cormier

More and more couples nowadays are cohabitating before marriage. But how does reimbursement claims work if a divorce happens?

Reimbursement Claims for Properties During a

Is This a Once in a Lifetime Opportunity to Refinance Right Now?


by Roy D. Oppenheim

If you wish to stay in your current home and refinance or buy a new home, now is the time

Should You Buy a Home During This Pandemic?

Supreme Court of New Jersey Affirms Rules as to Priority of Discretionary Advance Mortgages


by Mark Rattner

Supreme Court of New Jersey

Trending Articles

Announcing the 2023 The Best Lawyers in America Honorees


by Best Lawyers

Only the top 5.3% of all practicing lawyers in the U.S. were selected by their peers for inclusion in the 29th edition of The Best Lawyers in America®.

Gold strings and dots connecting to form US map

Announcing the 2022 Best Lawyers® in the United States


by Best Lawyers

The results include an elite field of top lawyers listed in the 28th Edition of The Best Lawyers in America® and in the 2nd Edition of Best Lawyers: Ones to Watch in America for 2022.

2022 Best Lawyers Listings for United States

2021 Best Lawyers: The Global Issue


by Best Lawyers

The 2021 Global Issue features top legal talent from the most recent editions of Best Lawyers and Best Lawyers: Ones to Watch worldwide.

2021 Best Lawyers: The Global Issue

The U.S. Best Lawyers Voting Season Is Open


by Best Lawyers

The voting season for the 31st edition of The Best Lawyers in America® and the 5th edition of Best Lawyers: Ones to Watch® in America is officially underway, and we are offering some helpful advice to this year’s voters.

Golden figures of people standing on blue surface connected by white lines

How To Find A Pro Bono Lawyer


by Best Lawyers

Best Lawyers dives into the vital role pro bono lawyers play in ensuring access to justice for all and the transformative impact they have on communities.

Hands joined around a table with phone, paper, pen and glasses

The Best Lawyers in Australia™ 2024 Launch


by Best Lawyers

Best Lawyers is excited to announce The Best Lawyers in Australia™ for 2023, including the top lawyers and law firms from Australia.

Australian Parliament beside water at sunset

How Palworld Is Testing the Limits of Nintendo’s Legal Power


by Gregory Sirico

Many are calling the new game Palworld “Pokémon GO with guns,” noting the games striking similarities. Experts speculate how Nintendo could take legal action.

Animated figures with guns stand on top of creatures

What the Courts Say About Recording in the Classroom


by Christina Henagen Peer and Peter Zawadski

Students and parents are increasingly asking to use audio devices to record what's being said in the classroom. But is it legal? A recent ruling offer gives the answer to a question confusing parents and administrators alike.

Is It Legal for Students to Record Teachers?

Inflation Escalation


by Ashley S. Wagner

Inflation and rising costs are at the forefront of everyone’s mind as we enter 2023. The current volatile market makes it more important than ever to understand the rent escalation clauses in current and future commercial lease agreements.

Suited figure in front of rising market and inflated balloon

The Upcycle Conundrum


by Karen Kreider Gaunt

Laudable or litigious? What you need to know about potential copyright and trademark infringement when repurposing products.

Repurposed Products and Copyright Infringemen

8 Different Types of Criminal Defenses in Law


by Best Lawyers

Learn about the different types of criminal defenses available in law, including innocence, self-defense, insanity and more. Protect your rights today.

Silver handcuffs laying on finger printed papers

Best Lawyers: Ones to Watch in America for 2023


by Best Lawyers

The third edition of Best Lawyers: Ones to Watch in America™ highlights the legal talent of lawyers who have been in practice less than 10 years.

Three arrows made of lines and dots on blue background

A Celebration of Excellence: The Best Lawyers in Canada 2024 Awards


by Best Lawyers

As we embark on the 18th edition of The Best Lawyers in Canada™, we are excited to highlight excellence and top legal talent across the country.

Abstract image of red and white Canada flag in triangles

Wage and Overtime Laws for Truck Drivers


by Greg Mansell

For truck drivers nationwide, underpayment and overtime violations are just the beginning of a long list of problems. Below we explore the wages you are entitled to but may not be receiving.

Truck Driver Wage and Overtime Laws in the US

Choosing a Title Company: What a Seller Should Expect


by Roy D. Oppenheim

When it comes to choosing a title company, how much power exactly does a seller have?

Choosing the Title Company As Seller

The 2024 Best Lawyers in Spain™


by Best Lawyers

Best Lawyers is honored to announce the 16th edition of The Best Lawyers in Spain™ and the third edition of Best Lawyers: Ones to Watch in Spain™ for 2024.

Tall buildings and rushing traffic against clouds and sun in sky