Rates may be on the rise, but it’s still a great time to refinance. Many of our clients have been sending out more direct mail lately due to these rates.
“The most popular mortgage rose to its highest level since late June, after stalling for a month and a half near a record low.” says Holden Lewis in an article posted from Bankrate.
According to Freddie Mac, as of September 15th, 2016 rates are as follows:
- 30-year fixed-rate mortgage (FRM) averaged 3.50 percent with an average 0.5 point for the week ending September 15, 2016, up from last week when it averaged 3.44 percent. A year ago at this time, the 30-year FRM averaged 3.91 percent.
- 15-year FRM this week averaged 2.77 percent with an average 0.5 point, up from last week when it averaged 2.76 percent. A year ago at this time, the 15-year FRM averaged 3.11 percent.
- 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.82 percent this week with an average 0.4 point, up from last week when it averaged 2.81 percent. A year ago, the 5-year ARM averaged 2.92 percent.
Rates head up. 30yr fxd avgs 3.50%, 15yr avgs 2.77%. https://t.co/LP1c45zQtV pic.twitter.com/pMaBMwnuU5
— Freddie Mac (@FreddieMac) September 15, 2016
Rates are still historically low when looking at the fluctuation in rates from 1971 to now. Looking back at January of this year, rates were at 3.87%, so 3.50% is still a great rate to refinance into. If you are interested at looking at the rates from 1971 to now, Freddie Mac has a great historical chart to look at.
Lets take that into consideration:
- John Doe has a $200,000 mortgage.
- At a 4.0% rate, his P&I payment would be roughly $955
- At a 3.50% rate, his P&I payment would be roughly $898
- While the savings is only $57 a month, over the life of the loan he could save over $20,000