Boston Homes
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One key refinance mortgage rate advances for this week



Refinance rates were mixed this week, but one key rate moved higher. The average for a 30-year fixed-rate refinance rose, but the average rate on a 15- year fixed held steady. The average rate on 10-year fixed refis, meanwhile, held steady.


The average 30-year fixed-refinance rate is 4.37 percent, up 2 basis points over the last week. A month ago, the average rate on a 30-year fixed refinance was higher, at 4.52 percent.


At the current average rate, you’ll pay $498.99 per month in principal and interest for every $100,000 you borrow. That’s $1.18 higher compared with last week.


The 15-year fixed refi average rate is now 3.66 percent, unchanged since the same time last week.


Monthly payments on a 15-year fixed refinance at that rate will cost around $723 per $100,000 borrowed. That’s obviously much higher than the monthly payment would be on a 30-year mortgage at that rate, but it comes with some big advantages: You’ll save thousands of dollars over the life of the loan in total interest paid and build equity much more quickly.


The average rate for a 10-year fixed-refinance loan is 3.65 percent, unchanged from a week ago.


Monthly payments on a 10-year fixed-rate refi at 3.65 percent would cost $995.90 per month for every $100,000 you borrow. As you can see, the big savings in interest costs you’ll reap with that short 10-year term comes with the downside of a much larger monthly payment.


Dick Lepre, a senior loan officer with RPM Mortgage, said, “The techs are mixed, but we should see slightly higher Treasury yields and higher mortgage rates in the coming week. In the longer term, note that the techs are starting a long term (12 to 15 months) bull cycle (higher prices, lower yields) which should see lower rates later this year. This could enable refinancing of mortgages made in the last 10 months of 2018.”


Jim Sahnger, a mortgage planner with the C2 Financial Corporation, agrees, saying, “Rates will go higher. We’ve enjoyed a nice run since we topped out in the middle of November, but the rally is looking a little tired. Rates may be pressured a bit from here by the threat of a shutdown being taken off the table in Washington as well as a potential resolve to the trade riff with China. Inflation continues to remain in check with CPI unchanged in January compared to a 0.1percent expected change. Rates shouldn’t move a lot, just a little higher until traders regain their focus.”


Michael Cox, the founding director and executive-in-residence of the O’Neil Center for Global Markets, Freedom SMU Cox School of Business and former chief economist at the Dallas Federal Reserve Bank, has a different point of view. He said, “The trend in the 30-year Treasury rate still appears to be downward, but the pace of decline has slowed to a crawl, bringing weekly change within the 0 to 2 basis point range, which would argue for an ‘unchanged’ call. But more talk of a slowing economy, rising delinquencies on car loans and continued slow inflation will likely tip the magnitude of the interest rate decline this week beyond two basis points. I’m thus voting: down.”


Logan Mohtashami, a Senior loan officer at the AMC Lending Group, believes, “Rates will stay the same. Once again we are back at this 2.71 percent level on the 10-year yield. We have tried three times now to break under 2.55 percent to 2.62 percent and all attempts have been rebuffed. It looks like the government shutdown will be averted and a China deal could be announced in the next couple months.


“The stock market has stabilized but hasn’t broken over the key 2,800 level. A lot of the issues that were concerning Americans in the confidence indexes could be solved quickly and, unless our PMI data and global PMI data gets weaker or we get a stock market sell off, we can be in this range between 2.55 percent to 2.82 percent for a long time as CPI data once again came in today tamed.”