The historically low mortgage rates sank even lower in November, setting records for both 30-year and 15-year fixed rate loans.
According to Freddie Mac, the 30-year fell to 3.31% from 3.34% in mid-November. The 15-year rate averaged 2.63% compared to 2.65%. The current conditions mean it may make sense for current mortgage borrowers and new home buyers to look at shorter-term loans.
An example of how the numbers add up follows: Homeowners currently paying off 30-year loans with rates of 4% spend $1,098/month in mortgage payments on a $200,000 balance, paying total interest of $143,739.
Refinancing at 2.63% for 15 years would cost them $250/month more, but they would end up paying just $42,250 in total interest and their payment years…
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