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Those who qualify rush to refinance

Associated Press / October 8, 2009

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Homeowners hustled last week to refinance mortgages after interest rates fell below 5 percent for the first time since May. Applications climbed 18 percent from the previous week, the Mortgage Bankers Association reported yesterday, as rates on 30-year home loans dropped to their lowest level in four months, 4.89 percent.

Still, more than 16 million homeowners owe more on their mortgages than their properties are worth. To refinance they would have to cover the difference, and then some. In some cases, that could mean forking over tens of thousands of dollars.

Others don’t qualify under stricter credit and income standards. And requirements for refinancing certain government loans will get tougher in November.

Rates hit a record low of 4.78 percent in the spring.