One of the likely side effects of President Obama’s foreclosure prevention plan could be lower mortgage interest rates. Right now, advertised rates are low, but few people can take advantage of them. But this month, when Obama’s foreclosure prevention plan starts kicking in, that could change. Here is what Supbrime Blogger points out could be coming for the mortgage rate market:
There are incentives from lenders to give you that advertised mortgage rate of 4.75%. While the incentives are not known, it is likely the are monetary making it even more alluring to both the lender and borrower.
With this knowledge, it is a great time to test to mortgage rate market. Many lenders need help from the government so they want to look like they are helping the economy by lending money to home owners. Obviously, they will remain strict in their lending practices, but if you have a credit score of over 720 and you have kept up with your mortgage payments, you have a great chance to lower your mortgage rate to under 5%.
With some help from incentives, you might just be able to get the mortgage interest rate you want. And that could be nice. You can save tens of thousands of dollars in interest over the life of your mortgage loan if you can refinance to a lower rate. And more people should be able to under Obama’s plan.
That is one of the nice things about this foreclosure prevention plan. It is not aimed only at people who are already behind on their mortgages. Rather, it rewards those who are proactive about trying to prevent foreclosure by getting behind. Another point is that the plan is also meant to help those who made good decisions — and may not necessarily be in foreclosure trouble — to refinance.
Of course, you still need to have a good credit score for the best mortgage interest rate, and the best chance of being approved.