Question

Feds cut rates 0.  5% today in response to this Coronavirus fear.Feds cut rates 0. 5% today in response to this Coronavirus fear. I really wanna refinance my house, since my current rate is 4. 875%. Do you guys think rates will continue to fall or something else?  

Answer 1

Well, no one knows. The rate cut today was a surprise. I’d say refinance sooner rather than later, but that being said, most European countries are showing rates at 0, which makes America’s 1-1. 25% not seem so bad. Yet I’d say it’s already dangerously low.  

Answer 2

I think the bigger q is does a refi make sense for you in general, but if it does, the time to do it is definitely now. Even if they cut another quarter or half point later in the year you can’t guess that and this is ridiculously low. I recently shopped for a mortgage and was getting 3. 5% rates with a 20% down. Beautiful time to borrow for a house.  

Comments

I have 4. 875% right now. summer 2018. dropping it woould lower my monthlies a LOT

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@valparaiso right but considering equity in house, cash on hand for down payment, closing costs, etc. Usually 2 years out from the original loan is tight to make the refi case when you run the numbers, but of course only you know your overall cash/equity situation.  

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@pamella2 yeah its a little hard. i can get cash though. dont wanna miss out.  

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@valparaiso you just gotta talk to a bank to get the offers and run the numbers. It’s totally situational. My point is just don’t assume a refi is better. It may or may not be the best use of funds if you have other cash. Look at what else you could do w same money elsewhere

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@pamella2 considering it would save me at least $500/month, x 342 months, thats $171k saved over the life of the loan. sounds ideal to me. i live in the bay area :P

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@valparaiso I’m not arguing with that. You have to compare the return vs investing that cash elsewhere

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@pamella2 well yeah, that would free up more money for me to invest.  

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@valparaiso talking about running numbers of investing the cash you’d be using to get the loan. I’m not saying it wouldn’t make sense (there are many things to consider) just that you have to consider the opportunity cost and run the scenarios against each other. I think you have some kind of perception I’m arguing against you but I’m just giving you some extra things to consider .  

Answer 3

Current rate is 4. 85%?! Why haven’t you done it sooner? Tsk tsk

Comments

@quotation because he’s had the loan for less than two years. Financial institutions wont even refinance a car until after 6 months.  

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Hard to have enough equity.  

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@apomict This is for a home loan and I was able to refi my house at 12 months.  

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@quotation right, my point was it takes longer to be able to refi a home compared to an auto loan. The bank/CU with the best rate may require longer loan time/lower LTV.  

Answer 4

Just locked at 2. 875 for a VA IRRL. Currently have 4. 99. Only had the house for 17 months. I have 75k in equity and plan on holding.  

Answer 5

Mortgages aren’t being affected the by rate cut right now BUT rates are SUPER low right now. Talk to a mortgage broker. Not a bank, a broker.  

Comments

Why wouldnt they?  

Answer 6

Bird in the hand, 2 in the Bush

Comments

How that apply here?  

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@valparaiso lock your rate now instead of waiting

Answer 7

What’s the base rate there? In the U. K. we can get base plus 1% without an issue

Answer 8

Have you looked at what your end total spent would be? For me, a refi would save me a couple hundred a month, but cost me 10's of thousands in the end. Not worth it.