The Fed’s just announce that they will purchase up to 600 Billion of Mortgage Back Securities from the Big Three (Fannie, Freddie and Ginnie)
This has already had the effect of lowering interest rates TODAY. While I am not a huge fan of refinancing, most of the time people send the savings instead of putting it back into the property; this could be an excellent time to check out your options.
I don’t see the market recovering prices anytime soon in the next few years so lowering your official payment could give you the opportunity to pay down the mortgage faster or other debt that you might have.
In today’s market, it is very important to understand that the only way to shore up your personal finances is to reduce the debt that you owe. In the book “The Top 10 Distinctions between Millionaires and the Middle Class” by Keith Cameron Smith, the first chapter talks about freedom vs. comfort. To strive for freedom from debt gives you more options than anything else. With today’s lower rates you could soon be on the path of freedom.
David Rider is a Mortgage Originator with Sterling Home Mortgage LLC as well as a former broker and owner of real estate companies.
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