Mortgage rates fall: Is it a good time to refinance my mortgage?
The average interest rate for a traditional mortgage has fallen to the lowest level since February, but is now a good time to be buying a house?
What's happening to mortgage rates?
The average interest rate for traditional 30-year mortgages decreased to 3.09% last week, the lowest level since February, from 3.15% the prior week.
Rates continued to fall across the board this week for different length mortgages, except for a 15-year fixed-rate mortgage. All fixed-rate mortgages have decreased in interest in comparison to this time last year.
US weekly average mortgage interest rates
- 30-year fixed rate mortgage: 2.88% (down 0.02 in a week and down 0.10 in a year)
- 15-year fixed rate mortgage: 2.22% (up 0.02 in a week and down 0.26 in a year)
- 5-year fixed rate mortgage: 2.47% (down 0.05 in a week and down 0.59 in a year)
Analysts say this should offset the rising price of houses; low mortgage rates mean the cost to finance a house should stay the same or slightly decrease.
Despite this, home sales have fallen for the fourth month in a row as there simply aren't enough houses to buy. Rising home prices combined with insufficient supply has continued to impact the housing market.
The low-interest rates must also be seen in the context of rising inflation across the US which should offset the interest rates somewhat. Inflation rose to a 13-year high last month, a rise of 5.4% after a rise of 5% in May.
Is it a good time to refinance my house?
Melissa Cohn, an executive mortgage banker at William Raveis Mortgage, said now is a good time to revisit financing your mortgage.
It could be a chance for those who missed out on the low-interest rates of February to save some money on their mortgage.
And American homeowners are taking the opportunity to do this.