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Take Your Mortgage Off Autopilot
Posted By Ron On July 23, 2012 @ 7:35 AM In Mortgages | Comments Disabled
Have you been in your current home for a few years? If so, it can be easy to ignore what’s been going on with the mortgage market lately – especially with all the bad news about foreclosures and people walking away from their obligations. But all the news isn’t bad! Home prices have stabilized in many markets and in a select few, have even started to edge back up. With current rates at their absolute rock bottom, ignoring ANY mortgage  news could cost you in the long run.
If you got a mortgage  less than 5 or 6 years ago, you’re probably paying in the 5% to 6% range on your interest rate. That was great back then, but it isn’t so good today. For those with a 20% down payment and a good credit score  (do you know your score?), rates for today’s mortgages can be as low as 3% to 4% … and even lower if you opt for an adjustable rate. By refinancing your mortgage  with Quicken Loans  or going through a matching service like LendingTree , you could save thousands (or even tens of thousands) over the course of your mortgage  term.
If you put those savings – potentially hundreds of dollars each and every month – into a retirement account such as a Roth IRA , you would be “sending dollars to your future self.” That’s how one financial advisor I spoke with explained it to me.
Make the decision to reconnect to the mortgage market and begin paying attention to the incredibly low rates that are available to you … especially if you’re paying more than 5 percent and even if you’re paying in the high 4 percent rage. If that describes you, click through NOW to Quicken Loans  or LendingTree  for no other reason than to investigate how much you *could* be saving each month. Of course, the precise amount that you personally will save from refinancing depends on your current interest rate, your loan amount and the costs you incur by refinancing, but with potential 2 percent drop in your rate, you’re bound to be much better off.
Don’t just throw them in the recycle bin – read your statements, pay attention to how much interest you’re paying, and notice how much your principle balance has declined since you got your mortgage. Why?
You may be able to save without refinancing at all if your balance has declined enough. Usually mortgage  lenders will waive the private mortgage insurance (PMI) once your loan balance reaches 78% of your home’s current value. You may have to pay for an appraisal but that cost could easily be recouped within just a few months if you’re not forced to pay for PMI. Then you still have a great deal since that cash can now go to your Scottrade  Roth IRA !
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