Mortgage Rates Set a Record Low in 38 Years!
During the month of April in 1971 Freddie Mac started keeping track of Mortgage Rate data. What is significant about this is that in 2 more months Freddie Mac will have been tracking this data for 38 years.
Now that Mortgage Rates have dropped for a 5th straight week, Freddie Mac is reporting that Mortgage Rates are at a record low since they started tracking the data back in 1971. Another way to put this is Mortgage Rates are the lowest in 38 years.
We checked rates on BankRate.com and at Freddiemac.com here are our findings:
| National Overnight averages (BankRate.com) | Jan. 16th, 2009 |
| 30 yr. fixed mtg. | 5.10% |
| 15 yr. fixed mtg. | 4.76% |
| 5/1 ARM | 5.64% |
| 30 yr. fixed jumbo mtg. | 6.85% |
| 5/1 jumbo ARM | 5.92% |
| Primary Mortage Market Survey© (FreddieMac.com) | Jan. 15th,2009 |
| 30 yr. fixed mtg. | 4.96% |
| 15 yr. fixed mtg. | 4.96% |
These new low rates are driving many Americans to refinance their house. As I cruise around the internet this morning drinking my piping hot
latte, I notice several new banner ads spread across many of the financial websites I am a regular on. I started asking myself, how much would I save if I refinanced.
Currently my wife and I own a home that is valued at around $429,000.00. We owe roughly $325,000.00 on our current mortgage and our interest rate is 6.35%. (These are rough numbers since my wife takes care of all our bills and I am too lazy to walk into the other room and ask her the real numbers).
So assuming I could drop my interest rate by 1% here is how the data would look.
Current:
Monthly payment: 30 Years
Interest rate: 6.350%
Loan amount: $ 330,000.00
$ 2,053.38 a month
Re-Finance:
Monthly payment: 30
Year’s Interest rate: 5.350%
Loan amount: $ 330,000.00
$ 1,842.77 a month
As you can see, just by taking off 1% from our loan, we would be saving $210.61. Hum, that’s interesting . . . I think I am going to get motivated now and walk to the other room and tell my wife we need to check into re-financing our loan.