Today's Mortgage Rates

Low mortgage rates are enticing more homeowners to apply for a mortgage refinance. Mortgage loan application volume rose 13% for the week ended Aug. 13, 2010, compared with a week earlier, according to the Mortgage Bankers Association (MBA). The MBA’s Refinance Index jumped 17% from the previous week.

Many homeowners are jumping at the chance to refinance as the 3o-year fixed-rate mortgage has fallen to an average of 4.6% and 15-year home loans are at 3.99%. With rates so low, here are a few things to consider if you are trying to decide whether or not to refinance.

• How long will it take to recoup any closing costs associated with refinancing? The longer you plan to stay in your home after refinancing, the better off you’ll. Have your mortgage broker run the numbers to find the break even point for refinancing.
• Do you have an adjustable-rate mortgage (ARM)? There are plenty of people out there who still have ARMs that are scheduled to reset at a higher rate at some point. Mortgage rates are low now, but think about whether or not you’ll be able to afford the monthly payments when rates start to climb again.
• Do you have enough home equity to refinance? It doesn’t matter how low mortgage rates are if you are underwater on a home loan. Unless you qualify for the government’s program to help distressed homeowners — which has had lukewarm results — it will be tough to get a mortgage lender to approve a refinance.

Even if you don’t qualify for a home refinance right now continue to make your monthly housing payments on time each month to avoid problems. Not only will you avoid foreclosure, but a as the housing market recovers you may find yourself in a better position to get approved for refinancing down the line.

The mortgage industry shed 2,500 jobs in June, as home sales continued to slow. The mortgage banker/broker sector had 246,500 full-time positions in June, according to  the Bureau of Labor Statistics.

Even though mortgage rates are at record lows, many potential home buyers are waiting on the sidelines, either unwilling or unable to get mortgage loans, which decreases the need for workers in the mortgage industry.

Much of the activity in the mortgage sector involves refinancing, as homeowners look to get out of high-interest or adjustable-rate mortgages. For some homeowners dropping their mortgage rate just 1% has the potential to shave hundreds of dollars off monthly mortgage payments.

The average mortgage rate for a 30-year fixed loan is 4.49%, and 15-year rates are 3.95, according to Freddie Mac.  Both mortgage rates are at all-time lows. But concerns about the slow pace of economic recovery has many potential home buyers steering clear of taking on a new home loan when the unemployment rate remains so high. Until the economy shows stronger signs of recovery, many people will continue to postpone their dreams of buying a home whether or not they can qualify for a mortgage loan.