Real Estate and Home Mortgages - when to refinance

I heard the FED lowered the interest rate about a 1 1/4 % recently. What kind of a rate can I expect to see for a 30 year fixed. I currently have 400K loan at 5.85% fixed for 30 My remaining balance is about 384K and plan on staying in the house for at least 10 years, probably more. How much can I expect to pay for refinancing fees?

I have heard I would need to see at least a 1/2% decrease in the interest rate to see a gain from refinancing.

Thanks in advance for the help

I've been shopping...you are going to want to stay right where you are my friend :)

Do you think the 30 fixed will fall to around 5% antytime soon

I don't need to shop (currently on a 15 yr fixed @ 4.85), but I thought the rates on 30 year had gone down approaching 5%. :confused: At any rate I think the conventional wisdom sets the trigger higher than 1/2% to save; I think absolute bare minimum would be 1% and in the back of my mind I think maybe 2% is the standard.

Pro's?

As a general rule - I've always looked for a 2% difference in rates to make a refinance worthwhile. Then again, I've only purchased/sold around 9 properties in the last 5 years... which doesn't make me a pro...

Actually, what i'm seeing, is that even though the fed lowered the rates, 30 fixed are acutally up a little due to the fear of inflation. Or so i'm being told, i'm not a pro either. Just shopping myself.

The Fed Fund's Rate has little (if nothing) to do with mortgage rates.

it has EVERYTHING to do with HELOCs, Credit Cards, Boat Loan, Auto Loans.

The 30 year mortgage rates come from the 10 year Bond. If the Bond goes up...rates are higher. Down, rates are lower.

The Bond typically goes up the moment after the Fed makes a rate cut.....this is why mortgage rates go up the day after.

>>> 2% as a minimum for a refi is ridiculous. Going from 5.875% to 5.500% (if available) on his scenario of $384,000 would "save" about $180 per month. in 10 years....that is $21,000. Now, remove the refi fees of approximately $2,500 from the deal and its a net savings of $18,500.

is it worth it?????

Soem will say yes and some will say no.

But 2% minimum, or 1% or 1/2%....it ALL depends on loan amount an terms.

A simple way to decide, in my opinion. How much is it going to cost to refinance? How long before the savings pays of the refi cost? Do you plan to be there longer than that? If so, do it.

A simple way to decide, in my opinion. How much is it going to cost to refinance? How long before the savings pays of the refi cost? Do you plan to be there longer than that? If so, do it.

this is exactly what my suggestion would be. people hear .5%, 1% or 2 % and that is just nonsense. Do the math and see, if its proabable youll be in the home when you will break even, then it is probably worth it. Unless of course your intentions of refing are other than jsut lowering the rate