Should you refinance your mortgage? - KMSP-TV

Should you refinance your mortgage?

Posted: Updated:
ATLANTA -

With mortgage rates at historic lows, it has many people thinking about refinancing. Cutting your mortgage payment down sounds like a good idea, but, refinancing is not for everybody.  

A 30-year fixed rate right now is about 3.5 percent.  A 15-year fixed rate is 2.75 percent. Do you get in there and take advantage of that so that you can lower your mortgage payment? Perhaps, but to qualify you'll still need a steady income, good home value and great credit.

According to Bankrate.com, you can't qualify for the low rates unless your credit score is high -- in the 700 range.  This is the perfect example of why you have to work to get your score up. If you have a conventional loan, in order to refinance, your home needs to have about 20 percent equity. You cannot owe more than the home is worth.

Refinancing saves you money on your monthly payment, but be aware that you have to pay closing costs.  It's no deal if you don't stay in the house long enough to recover those costs, so do some math and figure out how many months of lower payments it will take to make up your closing costs.

If you owe more than what your home is worth, you do have some options if your loan is owned by Fannie Mae or Freddie Mac. There is a program called HARP -- the Home Affordable Refinance Program.  You still have to have decent credit and a steady job history, but they'll work with you. Go here for more details -- www.knowyouroptions.com

  • I-Team Story ArchiveMore>>

  • Patient: Hospice company failed me too

    Patient: Hospice company failed me too

    Wednesday, August 27 2014 10:37 PM EDT2014-08-28 02:37:56 GMT
    The state is now looking into a defunct hospice provider originally investigated by the Fox 5 I-Team.
    The state is now looking into a defunct hospice provider originally investigated by the Fox 5 I-Team.
  • Hidden fees in checking accounts: Who's transparent, who's not

    Hidden fees in checking accounts: Who's transparent, who's not

    Wednesday, August 27 2014 8:10 AM EDT2014-08-27 12:10:06 GMT
    We already know about some of the fees our banks charge -- the monthly fee, the overdraft charge, out-of-network and minimum balance fees. That's standard stuff. But did you know that the average checking account has 30 fees attached?
    We already know about some of the fees our banks charge -- the monthly fee, the overdraft charge, out-of-network and minimum balance fees. That's standard stuff. But did you know that the average checking account has 30 fees attached?
  • Judge mulling sanctions related to ethics trial

    Judge mulling sanctions related to ethics trial

    Monday, August 25 2014 6:29 PM EDT2014-08-25 22:29:27 GMT
    A judge is deciding whether to sanction the Georgia attorney general's office, the state ethics commission and the commission's director for not releasing certain documents in a whistleblower trial.
    A judge is deciding whether to sanction the Georgia attorney general's office, the state ethics commission and the commission's director for not releasing certain documents in a whistleblower trial.
  • Contact the FOX 5 I-Team

    * denotes required fields

    We're sorry, but only one entry is allowed per person.
    Thank you for your continued interest.

    Thanks for contacting FOX 5.  To reach our newsroom by phone, please call (404) 898-0100.

Powered by WorldNow

KMSP-TV
11358 Viking Drive
Eden Prairie, MN 55344

Phone: (952) 944-9999
Fax: (952) 942-0455

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices