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Why Now Might Be the Right Time to Refinance
By Gabriel Traverso
CMR Columnist
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For California homeowners knowing when to refinance your home mortgage is critical. This month the National Association of Realtors predicted that home prices are going to face a nationwide drop and mortgage rates are going to rise. Fiserv Lending is predicting home prices to fall in key markets like Los Angeles and San Diego. Is now the right time for you to refinance?
Home Mortgage Refinancing
If it looks like home prices might be dropping in your market in the future, now might be the best time for you to refinance, but it is critical that you understand your local market. The National Association of Realtors this month announced the first nationwide price drop in existing homes since they started keeping track almost 40 years ago. Couple that with mortgage rates rising from a 30-year fixed-rate mortgage rate of 5.79% (at time article was written) to a possible 6.6% by the end of the year and you might be facing the fact that now is the time to refinance your home mortgage.
Should You Refinance? Know Your Market Before You Make a Move
Fiserv Lending is projecting flat-lining home prices overall for the next 12 months, but estimates that prices could drop as much as 9% in half of the 50 biggest real estate markets. What's in store for California? Several key California markets are predicted to lose value between now and April 2008:
- Sacramento: -0.9%
- San Jose: -1.2%
- San Diego: -1.3
- Oakland: -2.5%
- Riverside: -4.4%
- Los Angeles: -5%
For many California homeowners rising mortgage rates and dropping home values means that now is probably the right time to refinance. The only California market with prices going up is San Francisco with a projected increase of 0.7%. San Francisco homeowners must therefore weigh the rise in home value against the potential that mortgage rates go up later this year.
Source
CNNMoney.com: Forecast: 100 Biggest Markets
About the Author
Gabriel Traverso is a freelance writer, professional musician, and artist. He resides with his family in Reno, NV.
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