Mortgage rates and refinance rates remained low going into 2011. For the past five months conforming 30 year mortgage lending rates have been around the 4.75% range. Jumbo mortgage rates today are also low and have been since th first quarter of 2011. Jumbo mortgage rates today are averaging 5.25%.
These low fixed mortgage rates on both conforming loans and jumbo loans is enticing home owners who have adjustable mortgage loans to refinance to fixed mortgage loans.
Freddie Mac releasted their Quarterly Product Transition Report today which showed 95% of the people who refinanced chose a fixed mortgage. With mortgage rates today so low they are smart to do so.
Another smart thing home owners are doing when refinancing is getting a shorter mortgage loan. The borrowers who refinancned and paid off a 30-year fixed-rate loan, 34 percent of refinancers chose a 15- or 20-year loan. This is the highest share of refinancers since the begining of 2004.
You can’t blame borrowers for doing so with current mortgage rates so low. A large percentage of home mortgage loans were converted to fixed mortgage loans when borrowers refinanced from adjustable mortgage loans. 84 percent of borrowers who had an adjustable mortgage loans decided to refinance to fchose to refinance to a fixed mortgage.
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