Mortgage Rate News

This week has seen another change in mortgage interest rates and in the number of mortgage applications seen. Mortgage rates have fallen to 5.12%, reports Freddie Mac. This is on a 30-year fixed loan. The 15-year rate is 4.56%. In addition to falling mortgage rates, there has also been an increase in mortgage loan applications, reports Bloomberg:

Falling home prices and a government tax credit for first- time buyers are bolstering tepid demand. The Mortgage Bankers Association’s index of applications to purchase a home or refinance a loan rose 5.6 percent to 527 in the week ended Aug. 14, the Washington-based MBA said yesterday.

Refinancing is very popular right now, as people decide to take advantage of lower mortgage rates. And, for those with FHA serviced mortgage loans, it is possible to get refinanced even with negative equity. I just received notice that my home has actually appreciated in value, and I am seriously considering a refinance. Plenty of first-time homebuyers are also finding that there are incentives to take the plunge right now. Paying points up front can even help buyers get the best possible mortgage interest rate.

Refinancing: Improve your credit score

Refinancing is a bit more difficult right now. In order to get approved for some kinds of credit, you need to have a good credit score. Many creditors and lenders have increased their credit requirements, making it difficult to get approved for loans. In order to get a good interest rate, and in order to get approval, you need to have good credit. It can take 30 to 90 days to see a substantial difference, and you may find that you need to make big changes in order to sufficiently move your credit score higher.

However, if you can buy or refinance right now, you have the chance to save a great deal of money in interest payments.