If you’re looking to take advantage of interest rates while they are still low, you have two options. You can either buy a new house, or refinance to get a lower rate. Both options can have pros and cons, and which will benefit you more will depend on a few factors.
Refinancing can be a good option under either of two conditions. The first is high equity. If you have a lot of equity in your home, refinancing allows you to access it for a temporary boost in available funds. The second is shortening the length of a loan. If you can get a shorter term loan at a lower interest rate than you currently have, that’s usually an incredible deal. Of course, whether you’re actually saving money or not in the long term depends how much you’ve already put into your current loan.
Moving is a good option if you have something in mind for the type of home you want. Low interest rates enable you to purchase a more expensive home without necessarily increasing your mortgage payment by much, if at all, and it could even be lower. This is especially the case if you are actually looking to downsize — your mortgage payment would almost certainly drop. If you were already planning to buy, it’s still a good time, even with mortgage rates starting to climb back up.
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