Homeowners May Get to Take Advantage of Refinancing Again
- Treasury rally has 10-year yield approaching 2.6 percent
- Recent borrowers may benefit if mortgage rates move lower, too
Photographer: Sergio Flores /Bloomberg
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U.S. homeowners may see at least one benefit from the recent turmoil in equity markets -- a better shot at refinancing should the concomitant rally in U.S. Treasuries continue to pull down mortgage rates.
The Freddie Mac 30-year rate has dropped to 4.55 percent from a recent high of 4.94% in early November. According to consensus a homeowner needs about 50 basis points of incentive, and at least six months of past payments on their mortgage, to pull the trigger on a refinancing. Recent borrowers in higher-coupon mortgages would fall into that category.