Homeowners refinancing their homes are taking advantage of the lowest fixed-mortgage rates in the past 50 years, according to Freddie Mac's quarterly Product Transition Report. The report indicates 95% of refinance loans completed in Q210 were a fixed-rate mortgage (FRM).
"The ability to lock in a principal and interest payment at below 5% for 30 years is rare enough," said Frank Nothaft, Freddie's vice president and chief economist. "The share of borrowers shortening their amortization terms is at its highest level in six years."
Freddie Mac reported that refinancing borrowers overwhelmingly chose a 30 or 15-year fixed rate mortgage regardless of whether their previous loan was fixed or an adjustable-rate mortgage (ARM).
The report said 30% of homeowners who originally held a 30-year fixed refinanced into a 15 or a 20-year fixed rate, pushing the inventory of both loan categories to their highest level since 2004.
Rates are as low as 4.375% for a 30 year fixed with no points and 4% for a 15 year with no points.
Reliant Mortgage Company recommends fixed rate mortgages. Adjustable rate mortgages are a good choice when rates are very high and rates are expected to decrease in the future. With rates at all time lows, and expect to go up at anytime, this is the time to lock into a low fixed rate.
Contact one of our loan officers to find out more about refinancing.
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