Borrowers are loving the current record low interest rates, and homeowners stand to benefit even more.
If you bought your home more than a few years ago, you could probably benefit from a refinance at today’s low interest rates. With interest rates this low, you owe it to yourself to at least give refinancing a look. If you can refinance your mortgage and get a rate at least half a percent lower than what you are paying, chances are refinancing makes sense.
Refinancing your mortgage to get a lower rate is one of the smartest things you can do. When you refinance your mortgage to a lower interest rate, you gain the instant benefit of a lower monthly payment, and those savings can really add up. Depending on the amount of your mortgage, even a small drop in interest rates could mean hundreds of extra dollars in your pocket every month.
While those instant savings are certainly compelling, a lower mortgage payment is not the only advantage of refinancing your mortgage. When you take the long view, the value of a mortgage refinance becomes even more apparent. Every dollar you save now is one less dollar you have to pay the bank – and one more dollar you have to invest. Over the life of the mortgage loan, the combined interest savings and extra investment income could mean tens of thousands of dollars in your portfolio.
Refinancing your mortgage at the current low interest rates is also a great way to pay for needed home repairs. If your home needs work but you lack the funds to pay for it, refinancing your mortgage could allow you to take money out and tap the equity you have built up through the years. And since interest rates on home equity loans are generally lower than other types of loans, you will pay less interest as you get your home back in shape.
There are many compelling reasons to take advantage of the current low interest rate environment. These low interest rates have already lasted longer than usual, and they will not last forever. At one point interest rates will be going up, and when they do everything from home repairs to monthly mortgage payments could be costing you more. At the moment, interest rates are still at historic lows, and now is the time to act.
Related Articles
Alberta – The Benefits of Investing in Income Producing Properties
Making money in any real estate venture is a difficult task, and many people don't have the skills (or the stomach) for flipping houses. An alternative to this intrinsically risky activity is to purchase a property for the long term and rent it out. These types of...
Alberta – Why You Need an Emergency Fund And How to Get One
Building an emergency fund is something most people know they should do but few actually get around to doing. A recent study found that nearly two-thirds of Americans did not have an emergency fund, and more than half would have trouble coming up with $1,000 on short...
Alberta – Strategies to Dig Yourself Out of the Debt Hole
Debt. It's something almost everyone will have at some point in their life. But what happens when your debt begins to get the better of you? What options are available? Some simple strategies can help you get your debt out of a seemingly unmanageable situation; it's...