Home buyers are in a race against inflation, with many attempting to grab low-again rates before they disappear. The average rate for a 30-year mortgage, which rose to 4.18% (fixed) since the start of the year, plunged to 3.90% yesterday. The sudden drop in rates triggered a frenzy of activity, according to Lendgo, with many looking to refinance their mortgages before the housing boom comes to a close.
"Mortgage rates are sinking as markets contend with the ramifications of Russia's attack on Ukraine," according to Diana Olick at MSN. “The window of opportunity for buying a home or refinancing at remarkably low rates was seen closing, but now it has been thrown open again, however briefly. Homebuyers, though, face a challenge finding a place to buy because inventory is low and home prices keep rising.”
Those looking to refinance their mortgage stand a better chance at capitalizing on this opportunity than purchasers. Thanks to the one-two punch of this drop in interest rates and climbing property values, people who already own a home see a welcome opportunity to lower their monthly payments.
Popular quote comparison site, Lendgo, reported a sudden increase in people exploring their refinancing options. With inflation weakening everyone’s buying power, securing this week’s surprise low rates can prepare homeowners to weather price increases in other areas.
Lowering the current rate by just 1% can save a homeowner hundreds of dollars each month and thousands of dollars over the term of a mortgage. Plus, it can increase equity and create a cash-out option for homeowners.
Volatility requires quick action, and Lendgo encourages homeowners to act sooner rather than later. Lowering monthly payments on a mortgage is especially helpful when the cost of living is going up like it's expected to in 2022. If a homeowner wants to refinance while rates have briefly stooped to near-historic lows, the clock is ticking. Lendgo offers its free service to homeowners looking to browse through refinancing options.
