The recent drop in interest rates by the Fed was one of the largest in recent history. Lower interest rates could mean an excellent opportunity for homeowners looking to lower their monthly payments, but there are some important details to remember when deciding whether to refinance.

If you’re planning on refinancing, now may be the right time to talk to your bank or lender. After a huge drop in interest rates, they have started to climb again. The average 30-year mortgage was up this week to 5.88 percent from 5.57 percent.

Don’t try to catch rates at their floor, as there are many factors that go into determining what rate banks will charge consumers. Activity in the bond market, which is not controlled by the Fed, can affect the rate given by banks, regardless of Fed actions. If inflation becomes a concern, bond buyers will demand higher rates, which will lead to a rise in the interest rates paid on 30-year mortgages.

Also, if the economy continues to slow, real estate values could drop to levels that make it impossible for you to refinance the full amount of your original loan. With one of the largest drops in interest rates in history, the moment may be now to refinance that loan, instead of waiting for even lower rates.

Buyers can also get great rates on North Shore Chicago Real Estate. Take advantage of the opportunity today.

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This entry was posted on Tuesday, February 5th, 2008 at 3:35 pm and is filed under Evanston Real Estate(t) . You can leave a response.