We just ran across a very interesting piece on CNBC.com which, frankly, is quite surprising.
Apparently, homeowners are leaving billions on the table by not taking advantage of low mortgage rates. The story says that mortgage rates have been so low for so long that “it is hard to believe nearly everybody hasn’t refinanced to a lower rate yet.”
We wholeheartedly agree. More than five million borrowers could both qualify and benefit from a mortgage refinance, according to a new report from Black Knight Financial Services.
The report indicates that about 2.4 million borrowers could potentially save $200 or more on their monthly mortgage payments and an additional 1.9 million could save $100 to $20 per month. Add it up, and that’s $1.2 billion still on the table, according to Black Knight.
“If rates go up 50 basis points from where they are now, 2.1 million borrowers will fall out of the running; a 100-basis-point increase would eliminate another million, leaving only 2 million potential refinance candidates, the lowest population of refinance candidates in recent history,” said Ben Graboske, senior vice president at Black Knight Data & Analytics.
Hence, borrowers should act now and fast as mortgage rates are expected to rise through 2016. While mortgage rates do not necessarily follow the Federal Reserve’s moves to the “T,” they will indeed rise with an improving economy and job growth.
So, if you are thinking of refinancing, you may want to study your options sooner rather than later. As always, we’re here to guide and assist you, if needed.