High property values, low interest rates prompt homeowners to refinance
NEW YORK - A lot of homeowners know that home values right now are hitting new highs. So what should you do? Sell? Refinance?
"This is clearly still a seller's market because besides record-low mortgage rates, we also have some of the lowest inventory levels in history," real estate expert Jonathan Miller said.
New Jersey homeowner Robert Torino saw the changing market and decided to refinance his house a few months ago. His rate was 4.18%.
"We dropped under four, in the high threes and took the money from the refinance to do the right refinancing and pay down some debt that was outstanding," Torino said.
Miller said there are two benefits to refinancing.
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"Your payments are going to be less, you're going to have less monthly expenses number one," Miller said. "Number two is you could get a second mortgage or a home equity loan and take cash out to buy something that you need or pay for college or whatever it is. Many people have equity now that they didn't have a year ago."
Miller believes the market will be hot as long as mortgage rates are low. He also wants to remind homeowners that banks are being more conservative lately, so be prepared for the refinancing process to be a bit more difficult than usual.