Reasons Why You Should Refinance Your Mortgage Before 1st of April

If you're having thoughts of refinancing then NOW is the perfect time to apply for one! Improving housing market condition, increase in Premium Mortgage Insurance and potential mortgage rate increase are some of the factors why it would be more expensive to refinance your mortgage in the future.

1st Reason - Changes in Mortgage Insurance Premiums (MIP)

Effectve April 1, 2013, FHA will raise its annual Mortgage Insurance Premiums or MIP by 0.10% on all forward mortgages.  

The agency will once again require borrowers to continue paying the annual Mortgage Insurance Premiums for the remaining balance of their loan.  In 2001, FHA has cancelled the required Mortgage Insurance Premiums or MIP once the principal has reached 78% of the original principal balance. However, FHA remains responsible for insuring 100% of the outstanding loan balance until the loan is fully paid.  Due to billions of dollars revenue loss, the automatic cancellation policy will no longer apply.

2nd Reason - Potential Mortgage Rate Increase

Mortgage Professionals say that refinancers and home buyers who have not taken advantage of the historically low rates shouldn't waste time! 

Mortgage interest rates have hit historical lows during the country's economic crisis and have remained so until the first few months of year 2013, but experts believe that this may change SOON!  National Association of Realtors economist Lawrence Yun predicts the rates will reach 4% during the summer and 4.5 by 2014's first half as the US economy continues to improve.

3rd Reason - Benefits of Refinancing Before Filing of Tax Deadline

One benefit of refinancing during tax season is that you can prepare the same documents for your taxes and your refinancing application.  

If you wait after April 15th, it will take about 4 to 6 weeks to get an IRS verification that you have filed your taxes because other people will also be filing their taxes on the due date.  

Home owners that refinance could see hundreds of dollars in savings each month.  They will have more disposable income to pay bills, more money to spend in shops and restaurants in their communities, or more money to save for their children's college tuition or new car.  Since there's a need to fill the jobs that will support the demand, there will be more employment opportunities that will contribute to the growh of the US economy. 

    If you are looking to list or sell your home, whether it is a condo, single family, or mutlifamily   
    home now is the time to go on the market with record low inventory levels and fewer buyer 
    concessions being offered.  It is a sellers market!!   

Interest Rates Have Hit Bottom Low of Less Than 3%!

According to Mortgage News Daily, the fixed mortgage rates are at their all-time record lows! At current rate, the average 30-year fixed rate mortgage are at its all-time record low at 3.38% and the average 15-year fixed rate fell to a new record low of 2.75%. Last year, at the same time, the 30-year Fixed Rate Mortgage averaged at 4.09%, while the 15-year FRM was at 3.29%.

Freddie Mac's Vice President and Chief Economist, Frank Nothaft, said that, "Following the Federal Reserve's announcement of a new bond purchase plan, yields on mortgage-backed securities fell bringing average fixed mortgage rates to their all-time record lows which should aid in the ongoing housing recovery.  New construction on single-family homes rebounded in August, rising by 5.5 percent to the fastest pace since April 2010. 

In addition, existing home sales increased by 7.8 percent in August to its strongest pace since May 2010."

The Federal Reserve's decision to buy mortgage-related debt has helped the housing market by keeping the mortgage interest rates low, thus, encouraging more buyers to invest in Real Estate.

With the current interest rates, buying a home is practically free! More and more buyers are taking advantage of this all-time record low mortgage interest rates. Why don't you?

For more information on the current mortgage rates, you may go to http://www.mortgagenewsdaily.com/mortgage_rates/.