To Keep, Buy, or Refi

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Cut. It. Out.

The Fed cut rates again this week. So what does that mean for you?

Well, mortgage rates should start coming down, for one. There’s a little bit of lag in that world, but you should start to see reactions in the market in the coming weeks.

If you own a home, and you’ve been looking to move, but feel trapped in golden handcuffs (thank you, Great Financial Crisis and it’s lowest-ever-rates-for-an-entire-decade), there may be a move in your future.

Nobody can predict the future, but if I were in those shoes, I’d probably wait until spring and see what happens. 1) because rates will likely continue to drop – again, nobody can predict the future – and 2) there are a LOT more buyers in late spring and summer than right now. Not to mention more inventory (aka home options for you) on the market in warmer non-schooly seasons.

Now, I say that. Do as I say, not as I do… because I’m paying 7.5% on my mortgage.

That’s right, I gave up low 4’s to buy at the absolute peak last year. Maybe, coulda, shoulda, woulda kept our first home as a rental… live and learn.

I was playing around with a refinancing calculator today, and I can save somewhere around $500/month (and $200k over the life of the loan!) by dropping my rate, even with thousands of dollars in loan origination fees.

So what I’m going to do is keep an eye out on the rates, and if they dip back into the 5’s then it’s refi time for Simon.

Keep an eye on the market, friend!

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