The average rate for 30 year fixed mortgages dropped to its lowest point in three years. As of Friday, August 2, 2019, the rate was at 3.70%, the lowest it has been since November of 2016. The rates are expected to continue to drop over the coming weeks.
This drop means that a large number of 30-year mortgage holders are highly likely to qualify for a refinance and save at least 0.75% on their current interest rates. It is not only current mortgage holders that can benefit from the rate drop, lower rates also give prospective buyers a greater borrowing power. New borrows can borrow up to 15% more money and have the same payment they would last fall, for example, a borrower can buy a $45,000 more expensive house than before.
Though mortgage rates are considered favorable for both those refinancing and opening a new loan, borrowers need to be careful when they go to see a loan officer. According to a new survey conducted by Fannie Mae, at least one-third of borrowers are not shopping around to make sure they have found the lowest interest rate available to them. When it comes to comparing and finding the best prices mortgages are not the most popular items to shop around for. Many consumers find shopping around for mortgages daunting.
Comparison shopping can be intimidating, confusing, and very time-consuming. Just evaluating the actual price of a mortgage for an individual requires looking at several factors of each borrower and then adding up the many components of the loan like rates, fees, and points, and predicting how long a borrower will actually hold the mortgage. There are advertised teaser mortgage rates that hit us from every angle especially for those looking at mortgage info online, but these rates are just that, a tease, and can promise nothing without actually looking into a borrowers financial status, and each lender has their own evaluation process.
Of those surveyed that said they did not shop around, many of them reported that they were not so much concerned with competitive rates as they were with a lender they could trust and would provide great customer service and a quick response to questions and issues that may arise. So some individuals may have a good reason for accepting a hirer rate.
No matter what your reason for choosing a mortgage or refinance mortgage loan with any lender you want to make sure you have done your homework on the particular lender. Make sure you are financing with a solid and trustworthy company and if budget is a high priority don’t be afraid to look at more than one loan to ensure you are getting the best price.