What's The Next Move Bob Moulton, president of Americana Mortgage, told BankRate that people thinking of buying in the next year should move quickly if they find a property they like. Inventory is still fairly tight. Although there is no guarantee that rates will suddenly escalate, Moulton recommends locking in a property as soon as possible. Harris Interactive reported that 39% of homeowners who planned to invest in renovations to increase property values in 2013 did not follow through with their plans. If upgrades and renovations are on the agenda, homeowners should evaluate how a 1% or 2% increase in interest rates will affect their budget. Mortgage rates are still historically low based on the average over the past couple of decades. As the economy strengthens and mortgage lenders lose a steady stream of customers seeking home equity loans, less-stringent lending requirements emerge. Forbes reported that as much as 80% of mortgage activity in late 2012 was refinancing applications. Consumers with lower credit scores and budgetary constraints have a better chance of securing a loan with a higher rate.
Refinance Or Pay Down The Mortgage Deciding whether to refinance or pay down the mortgage quicker is tricky for some homeowners. Cost of financing isn't the only consideration. It is essential to consider long-term goals and risks. If doubling up on the mortgage compromises retirement planning, it defeats the purpose. Likewise, refinancing to gain a lower interest rate within one or two years of plans to sell the home would probably produce insignificant financial gains.