Fed rate and Mortgage interest rate, help please?
Tuesday, April 7th, 2009
Timothy H asked:
Hello, here’s the situation:
I currently have a mortgage of left of $159,000 at 6%. This is a 30 year mortgage, but I have been paying extra each month; and I am at around year 23. I also have a home equity loan of $25,000 at 7.25%. I am planning on paying the $25000 loan off in the next 5-6 years.
I went today to possibly refinance, she told me “Fixed rate at 5.75%, 30 years.” I can either combine the two and pay that, or pay my $25,000 at what I am paying right now; and just refi the $159,000. She is charging me $2000 in closing costs. If I wait, and the rate drops after closing, I get charged $700 more to lower the rate.
Should I wait until the 30th when the Fed either cuts, keeps were they’re at, or raises rates? This way, I will not have to pay the $2700 to get to that lower rate.
What do you think, please help me out. Any advice is appreciated. What impact will the rate cut have on my situation? Thank you! Tim
Allison
Hello, here’s the situation:
I currently have a mortgage of left of $159,000 at 6%. This is a 30 year mortgage, but I have been paying extra each month; and I am at around year 23. I also have a home equity loan of $25,000 at 7.25%. I am planning on paying the $25000 loan off in the next 5-6 years.
I went today to possibly refinance, she told me “Fixed rate at 5.75%, 30 years.” I can either combine the two and pay that, or pay my $25,000 at what I am paying right now; and just refi the $159,000. She is charging me $2000 in closing costs. If I wait, and the rate drops after closing, I get charged $700 more to lower the rate.
Should I wait until the 30th when the Fed either cuts, keeps were they’re at, or raises rates? This way, I will not have to pay the $2700 to get to that lower rate.
What do you think, please help me out. Any advice is appreciated. What impact will the rate cut have on my situation? Thank you! Tim
Allison
