Mortgage Refinance Clients Want to Know: Is Refinancing at the End of the Year a Good Time?

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October 13, 2022 | By RGR Marketing Blog

Should Your Clients Refinance Their Mortgage by Year's End?

With mortgage interest rates surging for the first time in years in 2022, a lot of homeowners who were considering refinancing their home loans have decidedly put their plans on hold to see whether the tide turns back the other way as the economy continues to slowly improve and inflation starts to ease. As a result, more are leaning towards refinancing closer toward the end of the year, if at all this year.

But is refinancing at the end of the year a good time? Your client’s ideal answer depends on certain factors.

How Much is Their Current Interest Rate?

At the time of this writing, the current average mortgage rate for a 30-year fixed-rate loan is 6.66%, according to Freddie Mac. With interest rates expected to continue to gradually rise over the coming months, this means that unless your client’s current interest rate is 7.66% or higher, then they may want to hold on their refinance plans because the savings they get may not be enough to warrant the cost of closing.

At the very least, your client needs to get a new interest rate that is 0.5% lower than their current one if they want to see any measurable savings worth the cost of closing. If they can’t get approved for at loan

Why Refinancing at the End of the Year Usually Makes Sense

While lenders can’t really do much about the interest rate, there are some things that they do have control over that can make the end of the year one of the best times to refinance. A lot of lenders often choose to reduce their fees when the year is nearly over to help boost their year-end closings.

Lower lender fees and other discounts can help homeowners save more money on their closing costs and thereby reduce the time it takes for them to reach their break-even point. For many, this can be just the thing to help them make their refinancing decision.

Does Everything Else Line Up?

Waiting until the end of the year to refinance can help homeowners save money on closing costs, but that doesn’t mean that every applicant can get approved for their refinance. Everything else still needs to line up.

For instance, is the client’s credit rating high enough to secure them a lower rate or has it dropped since they were approved for their original loan? Do they have the required 20% equity in their home that most lenders require of their refinance customers? Is their debt-to-income ratio within the range (50% or lower for FHA) needed to qualify for a refinance?

Your client also needs to consider how long they are planning on living in the home after they refinance. Should they be planning to move before they reach their break-even point, then they will wind up losing money on the refinance.

Don’t Try to Time the Market

There’s a right time to refinance and everything else is guesswork. Trying to predict which way the rate will swing is practically impossible. All a homeowner can go by is where the rate is at in the moment. As a result, if your client can save money or move closer to their financial goals by refinancing today, then they should lock in their interest rate today instead of waiting to see what tomorrow brings.

Connect With Prime Refinance Prospects with Mortgage Leads From RGR Marketing

With interest rates continuing their climb, the end of the year will no doubt bring with it a lot of homeowners looking to cash in on refinancing their loans before the rates get any higher. At RGR Marketing, we specialize in providing mortgage companies with the high-quality mortgage leads they need to maintain steady growth. With 20-plus years of experience working with mortgage companies, we know what makes for an ideal mortgage lead, whether they’re someone looking for their first home loan or to refinance their current one.

Contact RGR Marketing today to get exclusive access to mortgage leads that have been scrubbed and verified, so you can get right to work nurturing your prospects into customers.

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Should Your Clients Refinance Their Mortgage by Year's End?

How Much is Their Current Interest Rate?

Why Refinancing at the End of the Year Usually Makes Sense

Does Everything Else Line Up?

Don’t Try to Time the Market

Connect With Prime Refinance Prospects with Mortgage Leads From RGR Marketing

Start making more
money today!

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Should Your Clients Refinance Their Mortgage by Year's End?

How Much is Their Current Interest Rate?

Why Refinancing at the End of the Year Usually Makes Sense

Does Everything Else Line Up?

Don’t Try to Time the Market

Connect With Prime Refinance Prospects with Mortgage Leads From RGR Marketing

Start making more money today!

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