Mortgage rates are currently lower than 2014. Today’s rates have dropped back to 4%. This is great news for some new homeowners, but what is the cause? Rates are lower due to economic data being lower than expect, economic uncertainty overseas and expectations that the Federal Reserve may not see sustained domestic growth until sometime next year.
The Mortgage Report shares some valuable insight to this decline. Home purchasing power is up close to 10% from last year, which means that a homeowner whose maximum purchase price was $400,000 can today purchase a $440,000 home for the same mortgage payment; and, millions of U.S. homeowners are potentially eligible for a refinance. Low mortgage rates have put homeowners in the money for a refinance where “in the money” is defined as having a loan balance of at least $50,000; at least 10 years remaining on your home loan; and a mortgage rate of 150 basis points (1.5%) above current mortgage interest rates.
Due to this year’s current extremely low mortgage rate, homeowners refinancing in 2015 will save even more. Now is a great time to refinance your home! One important thing to note is that although mortgage rates have fallen nationwide, they still differ on a regional basis. The rate quote that you get from your bank will depend on the location of your property. It is reported that mortgage rates are lowers in the Northeast Region, an area comprised of New York, New Jersey, Pennsylvania, Delaware, Maryland, Washington, D.C., Virginia, West Virginia, Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut. By contrast, the mortgage rates are highest for applicants in the Southwest Region, an area that includes Texas, Louisiana, New Mexico, Oklahoma, Arkansas, Missouri, Kansas, Colorado, Nebraska, and Wyoming.