Friday, October 2, 2009

This is a Great Time to Refinance

With interest and mortgage rates already at a two and a half year low and Federal Chairman Ben Bernanke indicating the Federal Open Market Committee is ready to take drastic actions to help a struggling US economy, there hasn’t been a better time to refinance. The Fed is expected to reduce interest rates by another 50 basis points (0.50 %) when they meet, which means mortgage and loan rates will only drop further.

As a result, now is the time to refinance, take out home equity, or lock in a great loan on your home so you don’t need to worry about fluctuating interest rates. Given the number of interest rate reductions we’ve seen, it’s not certain if the Federal Open Market Committee will reduce rates further. That means now is the time to get the loan you’ve been considering or to refinance an existing loan so you can lock in a lower interest rate. If you want to hedge your bets, get a 3 or 5 year ARM, and then refinance another loan if rates continue to decline. It’s a no lose situation!

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