Homeowners looking to refinance or homebuyers looking for a home are currently able to get a 30-year fixed rate mortgage for around 5%. There are even some who are seeing mortgage rates below 5%, so homeowners are finding a better value for their mortgage by opting for the 30-year fixed rate.
Typically, homeowners are refinancing for a 30-year fixed rate mortgage for not only the lower interest rate, but also for the lower monthly payment. Homeowners that have been struggling to make their payments may not qualify for a home loan modification in all cases, so many are hoping a lower interest rate will provide alleviation from the strains that come with a mortgage.
A 30-year fixed rate mortgage is far from the only option for homeowners that are refinancing and homebuyers that are purchasing, but again, the low monthly payment is a big draw. There are other options, like a 15-year fixed rate mortgage, that come with a lower interest rate than the 30-year mortgage, but it comes with a higher payment.
Homebuyers and homeowners should be aware, though, that a 30-year fixed rate mortgage can cost more over the long run, as even low interest will mount up over the life of the mortgage loan. Homeowners and homebuyers are being told to look at their financial situation before making any big decisions regarding refinancing or buying.