Why Now is a Great Time to Refinance Your Home Mortgage

Demand for refinance loans remains high as millions of homeowners are still eligible to save thousands by lowering their rate and monthly payments. In April, 47 percent of all loans closed by U.S. lenders were refinances, down slightly from the past few months, but still high compared to the last few years.

Closing rates for refinance loans are also as high as they’ve ever been. According to Ellie, Mae, 50 percent of FHA refinance loans, 55 percent of VA refinance loans and around two-thirds of conventional refinance loans were approved in April. Right now is the perfect time to refinance and reduce your monthly payment.

According to the experts at The Mortgage Reports, there are two main reasons why refinances are up 10 percent compared to last year. The first reason is that home prices in the U.S. have been steadily increasing, with average prices 30 percent higher than the market bottom set in 2010.

The second reason why refinancing has seen a boost is due to low rates that allow homeowners to save hundreds off of their monthly mortgage payments. Freddie Mac says that there are over 1 million homeowners in the U.S. that are eligible for a refinance. With the typical household saving more than 31 percent by refinancing, now is the time to act.

Lower monthly payments are not the only reason to refinance either. Refinance lender loanDepot has posted a list of eight great reasons to refinance your home, including converting to a shorter term, taking out cash to consolidate your debt, using equity for home improvements and getting rid of your mortgage insurance payments.

If you are planning on selling your home sooner than you thought, switching to either an ARM or 3/1, 5/1 or 7/1 loan can help to lower your interest rate and payments. If you want to get more information about what type of refinance is best for your situation, you can get in contact with a licensed banker at loanDepot.com.