Below 4% 15 and 20-Year Fixed-Rate Loans Now Making Up 1/3rd of Refinance Transactions
Posted by Ted C. Jones on August 16, 2010
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As interest rates have tracked down, many homeowners are now taking advantage of using 15 and 20-year fully-amortizing, fixed-rate loans. Since these are shorter in duration than 30-year loans, they also feature lower interest rates.
Last week, according to Freddie Mac, while 30-year rates averaged 4.44 percent, 15-year loans were record-low 3.92 percent.
While the monthly principal and interest payment will be more for the 15-year loan ($735.69 versus $503.13 for the 30-year loan), the homeowner with the 15-year fixed rate loan will repay just $132,423 compared to $181,125 for the 30-year loan – a total savings of $48,702.
Shorter-term mortgages gain favor for refinancing- USA Today
