With mortgage interest rates low -- and predicted to go lower -- no real estate
column would be complete without a discussion of refinancing. Even though rates
took a jump recently -- in the week ending Nov. 30, 30-year fixed-rate mortgages
averaged 7.02 percent, up from 6.75 percent the previous week -- rates are
still at their lowest point in years. And for many people, the time is right
for refinancing.
Take Todd Templin, for example.
Templin, who owns a home in Pembroke Pines, is about to close on a refinance
of his 7 7/8 percent mortgage and is cutting his rate to 6 1/8. His savings?
About $360 per month. "Who wants to pay a lender any more than they have
to," Templin said. "I'm saving $360 a month, which is a car payment
or more money available for charity or my kids' college educations."
"This is probably the best time in the last eight or nine years to refinance," said
Don Cohen, a director and co-founder of Newman + Cohen Financial Management
Inc., a financial advisory firm with offices in Boca Raton and Miami. Newman
predicts that rates will drop again, and he's planning to take advantage of
the dip himself; he's looking into refinancing the mortgage on a commercial
building he owns in Coral Springs.
Apparently, a lot of people are following his lead. According to the Mortgage
Bankers Association of America, a Washington, D.C.-based trade association,
72.9 percent of all mortgage applications during the week ending Nov. 23 were
refinances, marking the eighth consecutive week that refinancing activity surpassed
70 percent of total applications. A year ago, when 30-year fixed-rate loans
averaged 7.6 percent, refinancing represented 27.9 percent of total applications.
