Homeowners that are looking to refinance or homebuyers that may want a new home have been able to get a low interest on a mortgage as of the last several months. Mortgage rates are currently around 5% and many homeowners have been able to get a rate as low as 4.75%, in some cases.
However, there is talk that when the Federal Reserve stops buying mortgage backed securities that interest rates on mortgages are going to begin to rise. While this is speculation, there are many analysts that feel there is a high probability that the low mortgage rates that many have been able to lock in on their mortgages are going to be long gone.
This speculation of rising interest rates has many homeowners looking to refinance to, commonly, a 30-year fixed mortgage. This is, again, allowing homeowners to get a fixed rate at around 5% or lower, which makes their monthly mortgage payment lower as well.
While refinancing or buying a home with one of these low rates can be helpful, in that it brings a low mortgage payment as well, anyone looking to get one of these low rates needs to weigh the pros and cons of refinancing or buying a home and make sure they are on the firm financial ground needed before proceeding.