MORTGAGE MARKET WEEK IN REVIEW
This week began with interest rates in record low territory but as the week progressed rates moved higher in response to positive news about the American economy and a potential EU solution for the Debt Crisis in Greece.
CURRENT INTEREST RATES | FEBRUARY 17, 2012
($200,000 – $417,000) 0 POINTS
• 30 Year Fixed: 4.000% (4.07% APR)
• 5/1 ARM: 2.875% (2.95% APR)
($625,501 – $2,000,000) 0 POINTS
• 30 Year Fixed: 4.750% (4.81% APR)
• 5/1 ARM: 3.375% (3.43% APR)
|CONFORMING (HIGH-BALANCE) RATES
($417,001 – $625,500 cap by county) 0 POINTS
• 30 Year Fixed: 4.125% (4.19% APR)
• 5/1 ARM: 3.375% (3.44% APR)
Rates are UP compared to last week.
Rates are DOWN compared to last month.
Rates are DOWN compared to one year ago
The “Cash-In” Refinance Gains in Popularity…
With published mortgage rates in the sub-4 percent range, homeowners are doing what they can to refinance into today’s low mortgage rates — even if it means bringing some cash to closing. For the first time in history, nearly half of all refinancing households lowered their loan balance at the time of closing.
Simply put, a cash-in mortgage is the opposite of cash-out mortgage — and there are plenty of reasons to consider a cash-in refinance.
The most obvious reason is if the rate on your present loan is too high and the value of your home is too low, the only way to refinance your loan is to lower your loan-to-value (“LTV”) and pay down your mortgage.
Another reason is that right now, your idle cash in the bank is exactly that — idle. The Federal Reserve is holding the Fed Funds Rate near 0.000%, inflation is below 2 percent (on an annual basis), and checking and savings accounts are yielding close to zero percent interest. If you moved those dollars from your bank account to your mortgage balance, you would earn an immediate return on your dollar. Each dollar you knock from your mortgage balance is a dollar you won’t pay interest on for the next 30 years and that adds up to big savings.
Put simply, a cash-in refinance is the opposite of a cash-out refinance. When homeowners execute a cash-in refinance, they bring money to the closing table to lower their mortgage balance.
Let’s look at an example:
Home value: $500,000
Mortgage balance: $510,000
Maximum loan amount: $475,000 (95% LTV)
In this scenario, the homeowner is underwater and must come up with $35,000 (plus any closing costs) to execute the cash-in refinance. That would put their loan-to-value ratio (LTV) at 95 percent.
For more information on Cash-In Refis, click here.
Contact Gina today to find out if you can benefit from refinancing your mortgage.
This post was adapted from an article written by Gina Kemsley – Copyright © 2011 Gina Kemsley, Terra Mortgage Banking, All rights reserved.
Gina Kemsley – Senior Vice President – Loan Consultant, Terra Mortgage Banking
Office: (415) 464-3144 – Cell: (415) 828-0218 – Email: firstname.lastname@example.org – Website: www.terramortgagebanking.com/loan-officers/gina-kemsley
About the author: The above Real Estate information on Marin County Real Estate was provided by Sylvie Zolezzi. I can be reached via email at Sylvie@YourPieceOfMarin.com or by phone/text at 415.505.4789. I specialize in residential real estate in beautiful Marin County, just north of the Golden Gate Bridge.
My goal is to provide you with the best home buying or selling experience possible by combining my business and financial experience with meticulous attention to detail and a warm, personable and caring approach to meeting your needs. I have an excellent track record as a successful, results-oriented negotiator and effective communicator. My analytical skills and understanding of current market conditions, along with my ability to utilize a broad range of cutting edge technological and marketing resources, make me an invaluable real estate resource.
I am a long term Marin County resident and home owner. I strongly believe our quality of life is extraordinary and practically unmatched. I love our community, quaint towns and vast open space and never tire of their breathtaking beauty. I know the neighborhoods, the schools, the amenities; I know where you want to live. I know and love Marin County!
I service the following towns in Marin County: Sausalito, Tiburon, Belvedere, Mill Valley, Corte Madera, Larkspur, Greenbrae, Kentfield, Ross, San Anselmo, San Rafael, Fairfax, and Novato.