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Looking to refinance? Now might be the time

Posted by Cheryl Costa  December 1, 2008 09:32 AM

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Mortgage rates have been stubbornly high for quite some time but the government's recently announced $800B plan to bolster mortgages and consumer loans had an almost immediate impact in the form of lower rates on mortgages.

Last Tuesday, 30 year fixed rate mortgages dropped approximately half a percentage point. It is now possible to find 30 year fixed rate mortgages at 5.5% or even less. In order to qualify for this rate, borrowers will have to have a solid credit history, substantial equity or downpayment, and a credit score of 720 or higher.

The lower rates will increase refinancings, which should put more money in consumer's pockets. It is also hoped that the lower rates will convince some buyers who were sitting on the sidelines waiting for the market to bottom to enter the market. That would also be good news.

Unfortunately, the lower rates won't help the many, many homeowners who would love to refinance but can't because they owe more than their home is worth.

Mortgage brokers reported that they haven't seen activity at these levels for at least a year and many expect that rates could drop even further. For more information, check out this recent Wall Street Journal article.

This blog is not written or edited by or the Boston Globe.
The author is solely responsible for the content.

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Local finance professionals share insights and advice on issues such as budgeting, managing debt, and retirement planning.

About the contributors

D. Abraham Ringer is a CERTIFIED FINANCIAL PLANNER practitioner and a Financial Adviser with Morgan Stanley Global Wealth Management in Boston. He is registered in MA, NH, NY and several other states to which his articles are directed. For more information please visit
Financial Planning Association™ of Massachusetts has 900 members who specialize in the financial planning process. Many of its members engage in philanthropic pro bono work in their communities, recommend legislation, elevate public awareness, promote financial literacy, and advocate for sound economic and tax policies.
Odysseas Papadimitriou is the founder of, a credit card and gift card marketplace, and, a personal finance site. He has more than 13 years of experience in the personal finance industry, and previously served as senior director at Capital One.

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