Many people are consider refinancing their mortgage in order to take advantage of near all-time low interest rates. However, many people are still holding back to see what happens with the housing market and overall economy. Waiting too long could cost you more money and even eliminate any benefits of refinancing a mortgage if my interest rate predictions come true.

Mortgage rates are currently at around 5% for a standard 30 year fixed rate mortgage. That is very low and has made refinancing very beneficial for many people. However, there are some people holding out thinking that if they wait a little longer, the benefits of refinancing will be even bigger. However, I think that mortgage rates will rise by around 1.75% by the end of the year, and here is why.

I think that the housing market, and overall economy, have seen their worst days. While 2010 will not be a complete turn around, things will get better. As things get better though, mortgage rates get higher, which is bad news for anyone considering a mortgage refinance.

Also, mortgage refinancing in the future can not get much better than it is now. Interest rates are the lowest they have been in decades. This is because the mortgage lenders and banks are trying to stabilize, and spur activity, in the housing market.

Homeowners should not wait any longer. I predict mortgage interest rates will rise. While 1.75% does not seem like a large number, it really adds up to a lot of money over the course of a large 30 year loan. Take advantage of the low rates available right now and refinance before things get more expensive.

-M Petrone

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