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Last week, long-term mortgage rates plummeted, putting many homeowners in a position to benefit significantly from refinancing.

Quicken Loans Chief Economist Bob Walters said, “Anyone carrying a 6.5 percent or higher interest rate on their mortgage, folks in an adjustable rate mortgage that is on the verge of resetting, and even homeowners who are in a mortgage but still paying mortgage insurance (PMI) are all likely to benefit from refinancing. There are hundreds of thousands of homeowners who could benefit from this drop in long-term interest rates right now.”

He continues, “Long-term interest rates plummeted last week for a few reasons: one, the Producer Price Index (PPI) number showed prices actually falling and two, continued weakness in the housing sector has some folks concerned that the economy as a whole will be negatively impacted by the weak housing numbers. The Fed’s decision last week to keep short-term rates the same also gave the market reason to take interest rates lower.

“Given that long-term rates have fallen so far, so fast, we’re likely to see a small upturn in interest rates in the near future however, so savvy homeowners should seize this opportunity while it is available to them. Overall, consistency in current market conditions would prevent any major shift though.

“As a homeowner, I wouldn’t be overly concerned about the housing market. As long as interest rates remain low and the economy continues to be strong, the housing market is in no danger of bottoming out; rather, I believe it will plateau at some point.”

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