Another Small Drop in Mortgage Rates
Can you believe it? The Federal Reserve is still planning on raising the prime interest rate, and yet mortgage rates themselves are currently dropping. While the drop is not large, it certainly reflects an opportunity for buyers in the early part of 2006. The Weekly Primary Mortgage Market Survey published by Freddie Mac reported an average rate for the 30-year fixed-rate mortgage of 6.15 with fees and points of 0.6. This is compared to averages for the first week of the New Year of 6.21 percent and 0.5 for fees and points.
Refinancing also continues to be hot. As long as mortgage rates are anticipated to increase, while current rates are staying steady or dropping, there will be more of us enticed into the refinancing approach to handling our debt. After all, it is the post-Christmas crunch, when many families are discovering that the latest assault on their credit cards is pushing them past their limits. Hopefully, those numbers are few, and there are more of us who are just trying to think smart regarding our mortgages!
Good rates can make refinancing in order to "lock in" a better option, especially if you are currently signed up with an ARM that is going to adjust later this year. You might want to do some "comparison shopping" of your own, if this is your scenario. After all, the less interest you pay, the better it is. Just be sure that you aren't sacrificing good payment options in the process. If you have the ability to put additional cash against your mortgage each year, and you give that up in order to get a better interest rate, it may actually work against you in the long run.
These are definitely interesting times. And as the Chinese proverb indicates, this can be both a blessing and a curse.