Recent reports have indicated that certain home loans, like a 30-year fixed rate mortgage, have seen an increase in interest rates but still remain at record lows. Rates on 30-year fixed mortgages have increased for two weeks straight but they are still at some of the lowest levels that have been seen in recent years.
While there are many who see these small increases in interest rates on home loans like the 30-year fixed rate mortgage to be minimal, there is question as to why many homeowners are still facing foreclosure. Despite the fact that mortgage interest rates are quite low, many homeowners are still unable to afford their home loan payment even though there have been opportunities for some homeowners to refinance their home loan, lock-in these low mortgage interest rates, and gain a more affordable monthly mortgage payment as a result.
It’s understandable that not every homeowner can afford to refinance their home loan or will be in the financial position to benefit from refinancing. Some homeowners have taken advantage of these low interest rates so that they can refinance their home loan to obtain a lower monthly mortgage payment while others have used a cash-in refinancing option in order to lower their overall home loan costs.
The average rate on some home loans like a 15-year mortgage dropped while others on some adjustable-rate mortgages remained unchanged or drop slightly, but it still seems that homeowners who are in a financial position to benefit from lower mortgage interest rates still have the opportunity to do so. Housing troubles have plagued countless homeowners across our nation and despite the fact that the mortgage interest rates many homeowners can obtain are at record lows and many would argue that home buyers stand to greatly benefit due to low mortgage interest rates, there are questions as to why foreclosure prevention plans are not working.
There have been homeowners who have been able to benefit from mortgage modification plans like those made from the Making Home Affordable Program and in-house alternative modification plans made directly from mortgage servicers. Yet, low mortgage interest rates are simply unhelpful to homeowners who cannot afford to pay closing costs when they refinance and some refinancing opportunities are available to homeowners who may be in an underwater mortgage.
However, homeowners who may be struggling to make their monthly mortgage payment have had refinancing opportunities available for the past months with these low mortgage interest rates, which have allowed some to save their home from foreclosure simply by either refinancing to a different mortgage or by getting a lower mortgage interest rate. Low mortgage interest rates are not the solution for all homeowners who may be having trouble making their mortgage payments but they have assisted some homeowners who were simply unable to make their current mortgage payment and were fearful of missing home loan payments.