Mortage rates hit 37-year low

By Michelle Carolla
WBTW Reporter/Anchor
Published: January 12, 2009

Mortgage rates are now at a 37-year low. This is great timing for people interested in refinancing to lower monthly expenses.
  But is refinancing the right move? Joe and Diane Juliano moved to Myrtle Beach from Long Island just a few months ago. They bought their house before the real estate market dropped and decided to look into refinancing.
  After some investigation, their current rate of 5.25 percent is very close to the average rate of 5.10percent for a 30-year fixed rate mortgage.  But they still want to take advantage of the low rates.
“What I could possibly do is take an equity line against my house at 3.1%, if there’s equity in the home,” said Juliano.  “We could use that money to put a down payment on a possible second unit which would be either an investment or maybe a rental unit in the future.“
The key to getting a low rate is your credit score. You’ll get the best rate with a score of 720 or better. If your score is lower, you’ll pay more for your mortgage.
Bill Blackburn, a mortage broker in Myrtle Beach said the money is there, if you qualify. “The first thing to do is determine your credit score,” said Blackburn. “Second thing to do is find out how much equity is in your home and the third thing lenders are looking for is income. We don’t do stated income type loans anymore. Everything is a full documentation.“
Blackburn said if your current mortgage is between 6 and 6.25, check into refinancing, you could save hundreds of dollars a month.
Those who can benefit the most:
-Have equity in their home
-Have great credit
-Plan to stay in your home 4-5 years to recoup the several thousand dollars it will cost to refinance.
-Your new rate is at least one percentage point lower than your current rate.
Again, you can possibly save hundreds of dollars each month by refinancing. If so, take the saved money and pay down your credit cards, create a nest egg for this uncertain time we’re living in and even make extra mortgage payments.
    Speak with a mortgage professional for your options.