Is it time to start scrambling??

But first, I know you’re probably itching for a helpful video so check out my discovery of this new app/site Finaya.com. Looks like a promising start to finish homeownership system that’s supposedly going to change everything about the house-having experience. Do me a favor, watch this real quick and comment what you think 👇👇

Yeah it might seem a little boring but it’s important! See, rates have been dropping the last couple weeks (despite some losses last week, we are still averaging in the mid 6s) and it’s making folks think.

Some are thinking about buying and we’re seeing signs of increased activity in the buying market. This could lead to chaotic feeding frenzies if too many decide it’s time to get that new place. But too soon to tell.

I’ve also had so many past clients and partners asking recently if this is the right time to refinance. And like every good financial question the answer is: maybe!

See, refinancing isn’t just some one-size-fits-all blanket process that everyone always needs to do every time rates drop. There’s a lot of nuance to it. So here’s what I’m telling everyone: yes and no. I’ll explain.

YES

I’m saying it could be the right time in a few instances.

1. Debt consolidation - If you’ve got a lot of high-interest debts like credit cards, personal loans, etc to get an overall lower rate and monthly payment, this could be a good time to do it. Chances are you have good equity in your home if you’ve lived there a few years and paying off all that debt could save you A LOT of money in the long run. Even if it means getting a higher mortgage rate than you’ve got now (even though that hurts, I know).

2. Your current rate is really bad - I’m talking in the mid to upper 7s or low 8s. Normally my rule of thumb is to refi once you save at least 0.5% on your rate, and in this case you could be getting a lot more of a drop than that. So even if we refi again when rates drop more over the next year, taking advantage now could still be worth it.

3. Life changed and your payment is too high - If this rough economy is taking a toll on your finances and your mortgage payment is making you house poor, now might be a good time to get some payment relief. While that may not look pretty for your total interest in the long run, everything is better than foreclosure! There are always better solutions.

4. I’m strapped for cash - If my pipeline is thin and I need to close some loans, you know I’m going to tell you it’s a good time to refi so I can get that commission check! JUST KIDDING!! I would never tell anyone to refinance unless it was good for them financially, who am I Rocket Mortgage??

No

There are also times where I’m telling y’all that it’s a bad time to refi, even with the big rate drops recently. The main reason: I think they’ll drop even more! If we are really shifting to a lower-rate market, which it looks like we are, mortgage rates will continue dropping through the rest of this year and into 2025.

So if you’re thinking about a refi simply to get a better rate, GOOD! But if we do it now, we might just have to again next year and you’ll have gone through the process and paid those closing costs for little gain.

If you’re in the low 7s and under, it may not be worth it… yet. But stay tuned, because your time is getting closer!

And BTW, if you want to refi just to get rid of PMI, don’t! If your home’s value has jumped over the last few years, there could be some much easier ways to get rid of that mortgage insurance.

Beware

One more thing, when we see rates drop like this, the vultures come out! My clients are getting dozens of calls from random lenders trying to get them to refinance. They’ll quote these outrageously low rates, but add insane fees later in their bait-and-switch scam.

So be very careful if you or a client gets a call from one of these sharks, because things usually aren’t what they seem.

Moral of the story with all this: TALK TO ME FIRST! It’s nearly impossible to know if now is the right time to refinance without actually looking at some numbers first. That’s what I’m here for!

So if a refi has been on your mind, do yourself a favor and shoot me a text, or write an email, make a call, send a carrier pigeon for all I care. Reach out to me, we’ll take a look, and I’ll give you some honest numbers about if now is the right time to upgrade your mortgage.

New here’s a couple things to know about last week’s rates and what to expect next week: