It is no secret that with interest rates at historical lows, our savings accounts at the bank are receiving no interest at all. Because of our weak economy, CD rates are not very exciting, and it does not look like interest rates will be going up dramatically any time soon.
Still, there is an upside – borrowers have the opportunity to take advantage of these low rates. If you have a fixed-rate mortgage that you have been in for at least five years, for example, it may be worth looking at refinancing that mortgage. Rates have dropped a good amount in the last five years; refinancing could save you thousands of dollars of interest if the conditions are right.
Here are a few questions to help determine if it is a good move for you:
- Do you plan to stay in your home for at least another five years?
- Do you have equity in your home?
- Do you have an enough liquidity to pay closing costs?
- Are you current on your mortgage?
- Do you have a second lien/ mortgage (HELOC)?
If you answered “yes” to all of the questions above, the prospect of refinancing your mortgage is worth a closer look. Your financial advisor can help you further evaluate your particular set of circumstances and options.