Question by geraldine w: Should I wait until next year to refinance my mortgage? I am buying a single family home in California?
I am skeptical of refinancing this year since the rates are up from last year. I am hopiing the rates will go down instead of up next year. Should I wait?
Answer by zyberianwarrior
depends on what kind of a mortgage you got. If its an ARM GET OUT OF IT NOW! The rates are slowly dropping and many expect a nice drop next year also check to see if there are any penalties for refi and some will even make you pay for an apprasial before hand (don’t do it)
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Is that the same question? If you are buying then you are purchasing a home. If you are refinancing then you’re reworking the loan on your current home.
Let me offer you some advice as a loan officer based in California: the market here is definitely cooling off, but that doesn’t mean that it’s necessarily a bad time to buy. If you’re able to negotiate well with a seller (and this may be the perfect time for that) you could get a good deal. Remember that it’s you that has the upper hand in the current market.
Rates are a tricky situation. There has been a bit of a dip of late, and I’ve been doing many loans for people in the area because of this fact. However, I don’t personally see the point in “waiting for rates to drop” as much as most people. If you have good credit you can get a rate below 7% these days. Historically that’s a spectacular rate. Unfortunately we’re all tainted by our recent memories of folks getting 4%.
It’s honestly never been a “bad time” to own a house if you plan to stay a minimum of 5 to 7 years. If you have any questions that I didn’t answer, send me an email through my profile.
If your question is strictly about refinancing your current mortgage, nobody has a crystal ball but there is a small chance that we will see a small rate drop in the first quarter of 2007.
Beyond that it’s a gamble. If you can tolerate the risk you might do well to wait until late Winter/early Spring to refi. At this point in time, I would not recommend waiting beyond early 2007. If the break even analysis shows that you will recover your costs in 2-3 years then do it now or early in the first quarter of 2007.
Here is a link to a daily rate lock advisory posted by a mortgage broker that I have used twice in the past.
I have no financial connection to him, and only provide the link because it is useful information and I was happy with his service.
Don’t listen to the guy who said to stay away from adjustables…. the loan that is right for is dependant on your situation. I am a professional mortgage planner based in California and I will gladly answer any questions you might have (email or YIM!).
As it was said before, waiting for rates to drop is really not the way to go…. you never know what might happen that could send the rates through the roof and you will look back on this time and think to yourself, “I should have refinanced then!”.
Rates are at a current low for this year. If you can improve your loan, don’t wait.
If you have any other questions, or need assistance, please contact me via my website http://www.slarson.com/contact or email me directly at Steve@SLarson.com
is the rates going down next year