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On July 16, mortgage giant Freddie Mac announced that the average interest rate for a 30-year home loan had fallen to 2.98%. In addition, the average interest rate for a 15-year home loan had declined to 2.48%.1

A 30-year mortgage at less than 3% interest? A 15-year mortgage at less than 2.5% interest? These lows were historic milestones, unseen in the 49 years of Freddie’s weekly surveys. It’s unclear how long this low-rate environment may persist.1 

Are you considering refinancing your mortgage? Keep in mind that just two summers ago, the average interest rate on a 15-year, fixed-rate mortgage hovered around 4%, while the 30-year was in the vicinity of 4.5%.2

A traditional refinancing – in which you swap your current mortgage for a new one – may help you manage your monthly payment. Among other factors, you will need to consider the loan amount and length of the loan during the refinancing process.1,3 

Refinancing your mortgage may be a challenge. Loan demand is high right now, and some lenders have raised their standards amid the current economic uncertainty. Some factors that a lender may consider include your credit score, work history, and debt-to-income ratio.4

Could mortgages become even more affordable in the months ahead? While this may seem improbable, it cannot be ruled out. Mortgage issuers are dealing with a level of uncertainty that makes it harder for them to judge risk and assess the long-term value of the loans they originate.

With mortgage rates at historic lows, it may make sense to review your current mortgage and see if refinancing will benefit you. In addition to refinancing costs, and comparing what your current interest rate is versus what your new rate would be, an important thing to consider is how long you plan on staying in your house. Refinancing usually doesn’t make sense if you plan on selling the house in the near future. Each situation is different, and if you are considering refinancing and would like an analysis to see if it may be beneficial for you, please reach out to our financial planners to review. 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.


1 – Orange County Register, July 16, 2020.
2 – FreddieMac, July 18, 2020.
3 – NerdWallet, September 4, 2019.
4.- NYTimes, June 5, 2020


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