FOR IMMEDIATE RELEASE:
DENVER, Colorado -- May 7, 2008 -- The mortgage interest rate outlook is getting better by the minute. But many consumers aren't taking advantage of rare bargains because they are too focused on economic doom and gloom.
Optimism is scarce in the headlines. Or at least it is scarcely reported within the mainstream media. But the good news is that conventional 30-year fixed rate mortgages are a bargain.
· Recent rates on the 30-year fixed rate mortgage hover around the attractive six percent level, after the Fed Funds rate was cut to 2 percent on April 30th.
· With the housing market oversold, home prices are historically affordable and builders of new homes are throwing in lots of valuable perks and upgrades for free.
· Homeowners who want to refinance, take out a home equity loan, or use a home equity line of credit (HELOC) to fund home improvements or upgrades can do so at lower prices.
· Those who purchased a home within the past few years and got stuck with an increasingly expensive adjustable rate mortgage can now refinance into a predictably prudent conventional mortgage at rock bottom rates.
· Don't delay, however, because the Federal Reserve issued statements at its final April meeting indicating that the unprecedented series of big rate cuts may be finished.
Those who act quickly to capture a discounted cheap fixed rate now will enjoy built-in savings when the cycle again sends the cost of borrowing higher.
Although rates during the most recent real estate bull market spoiled many consumers with super-low single digit interest, many of those rates were just teasers or come-on's to lure buyers into ARM loans that have now catapulted into double digit territory. But safer conventional 30-year rates like those offered now have not been around in years.
With a slowdown in the housing industry putting the squeeze on builders and contractors, their services are also available for discounted prices. Many are hungry for work, so this summer offers a great opportunity to add tangible equity and quality of life enhancements for a reasonable price to a home, rental unit, or vacation property.
To further offset the rising tide of household expenses while maintaining a prudent rein on a monthly mortgage, consumers should consider employing a biweekly payment strategy.
Here's how it works:
· Say, for instance, that your monthly payment is $1,600. Instead of paying once a month, pay $800 every two weeks.
· By paying half of your payment every two weeks, you make the equivalent of a whole extra monthly payment per year.
· Savings realized over the life of a 30-year loan could cut the payoff time by about three years.
· That not only saves you all those extra payments but it adds up to large savings of interest paid on your outstanding principal balance.
Although many mortgage lenders and banks will manage a biweekly plan for you, they do so for fees that typically undercut your savings.
A better strategy -- as long as you are somewhat organized and have a moderate amount of financial discipline -- is to just create and manage it all by yourself. Most mortgage companies will let you employ this clever but painless strategy, and it will not cost you any extra to launch your biweekly payment savings program.
For more information, visit: http://www.GayRealEstate.com or http://www.GayMortgageLoans.com
Jeff Hammerberg, Founder & CEO
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