Lowering Mortgage Payment

by Sharon
(Greenfield, MA)

Ask Kate: Lowering a Mortgage Payment
Hi Kate, We bought our home in 2007 with an MHFA (Massachusetts Housing Finance Agency) first-time homebuyers loan, at an interest rate of 6.125%.



A few months ago we planned to refinance with the same lender at a 4.6% rate. We would have had to pay 2 points to get that rate, but because of the protections offered by that loan, we thought it was worth it.

Unfortunately, on the day we were supposed to lock in the rate, it jumped up suddenly to 5.1%, so we decided to wait. Ever since, the interest rates have just been going up - today they were back up to 6.125%!

• Do you think there is any hope of current mortgage interest rates going back down?


• Should we wait for a rate under 5%, or should we go for it if it goes back down to 5.1?

While we are not struggling to make our monthly house payments, we certainly could use the savings. Do you have any suggestions for how we should proceed? Thanks, Sharon

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Kate Answers: Lowering a Mortgage Payment

Hi Sharon, A crystal ball would come in handy right now! Locking mortgage rates continues to be the number one challenge during a mortgage process. I know this because of the number of letters I receive from Readers in similar situations to yours.

First of all, let's review the nitty gritty of mortgage interest rate locks because it is important to understand how the procedure works.

Secondly, you can expect the following from mortgage rates. In fact, I am so confident about this, I call it my mortgage rate lock guarantee.

I am also wondering if you can answer this question: If you lock mortgage rates over the phone, how do you protect yourself against hidden fees? Go here to find out!

At the bottom of this page, Sharon, you will find more ways to control mortgage closing costs and questions to ask before you lock a mortgage rate. By all means, please let me know if you have more questions.

Take a moment to bookmark Lowering a Mortgage Payment to your favorites and visit often for more ways to get your best mortgage rate. You can also invite friends to comment on this page or ask another question of their own like you did.

Here's to lowering your mortgage payment,

Mortgage Broker Fees

What Is Yield Spread Premium

Questions To Ask BEFORE You Lock

Lastly, what happens when rates plummet after a mortgage interest rate lock? Emotions spark, that's what! While this is the opposite of your current situation, you will want to read what others write about interest rate lock agreements.

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