Summary: Are you thinking of refinancing your Washington home mortgage in 2020? This article will help you determine if refinancing in 2020 is right for you.
Does refinancing a mortgage loan in Washington State makes sense in 2020? A lot of homeowners seem to think so. A recent report showed an increase in mortgage refinance activity in Washington and across the nation. Many homeowners are benefiting from low mortgage rates and higher equity levels. But is refinancing right for you?
Mortgage Loan Refinance in Washington and U.S. Refinances Climb In 2020
Applications to refinance mortgages are soaring lately as mortgage rates continue to hover near historic lows. Purchase applications may have slowed over the early part of the coronavirus pandemic, but they are picking up steam over recent weeks as more sellers choose to list and a slew of buyers enter the market.
The refinance boom has been going on for the past few months, which shows us that more homeowners in Washington and across the country are refinancing their existing mortgage loans. But why? There are a couple of reasons for this upward trend.
Low rates: One reason for this uptick is that mortgage rates have been hovering near historical lows for the last few months. According to the weekly industry survey conducted by Freddie Mac, the average rate for a 30-year fixed mortgage loan was 2.93% during the week of September 3, 2020.
Thirty-year rates have been hovering around 3%, on average, for many months now. And recent forecasts suggest they will likely stay low throughout the remainder of 2020. Perhaps that’s why we are seeing a higher number of mortgage refinances in Washington, as of late.
More equity: There’s another reason why it might make sense to refinance a home in Washington in mid-2020. House values across the state have risen steadily and significantly over the last couple of years. In fact, Washington has posted healthy year-over-year price gains and is currently experiencing a very hot real estate market.
This means that homeowners are enjoying higher levels of equity, which could put them in a good position to refinance their existing mortgages.
These two factors combined – relatively low mortgage rates and steadily rising home values – could make it a good time to refinance your home in Washington.
Could You Benefit from Refinancing Your Mortgage?
Is 2020 or early 2021 a good time to refinance your home in Washington? That depends on your financial goals, your current equity situation, and the rate you have on your existing mortgage loan. By evaluating these three factors, you can determine if it makes sense to refinance into a new home loan.
People use mortgage refinancing to accomplish different goals. Some do it to convert equity into cash, while others do it to reduce their monthly payments. Most people fall into the latter category. They do it to secure a lower mortgage rate on the new loan and thereby reduce the size of the monthly payments.
This is where the “break-even point” comes into the picture. This is the point at which the money you save (by reducing your rate) begins to exceed the amount you pay in closing costs for the new loan. We can help you determine the potential for long-term savings by evaluating your current mortgage situation, along with the rate you qualify for.
Have Questions About Mortgages?
Sammamish Mortgage is a local, family-owned company based in Bellevue, Washington. We serve the entire state, as well as the broader Pacific Northwest region that includes Idaho, Colorado, and Oregon. We offer a wide variety of mortgage programs and products with flexible qualification criteria. Please contact us if you have mortgage-related questions.