With all the ups and downs on the news, timing anything nowadays could give you a headache.
But signs of rates staying put in the next few months can help you take advantage and save money in the long run.
Here are some strategies that could refocus your investment strategy, lower your monthly payment or improve your lifestyle or additional capital for your business.
Refinancing is almost a no brainer
If you bought your home several years ago while interest rates were higher, you may save more on your monthly payments if you obtain a lower rate.
An average of .75% rate reduction could save you $170/month on a $300,000 loan amount. Play around with this refinance calculator and see how much you can save.
If you think about it, that’s an extra $2040 to your savings a year.
However, if you continue with the same payment amount- using the savings to go towards your principal balance, you would be able payoff your home sooner than later and save more in not paying the interest.
You can also consider a fixed rate mortgage instead of an adjustable rate mortgage. Giving you peace of mind that your rate will not change.
If you have more wiggle room in your finances, consider a 15-year mortgage. Payments are higher but you can pay your mortgage sooner.
Consider buying a home
Although home prices are high right now, even for first time home buyers. The dip in mortgage rates could still be a great deal for you.
If you have the flexibility to move and find a home that’s close to the monthly payments for rent, given that your credit score is good, you have a down payment and stable job. It’s almost impossible not to jump on this opportunity.
Try to look into properties that may not be in perfect condition and you are willing to do some of the labor yourself. You may be surprised that sellers are willing to negotiate the price since they won’t need to burden themselves with the project.
Student loan refinancing
If you are one of the individuals that have student loans and the interest rate is high. This could be the best time to refinance those private student loan debts.
If you have enough equity in your home, you can also consider rolling it in your refinance and just have one payment every month.
It could also boost your credit score since your student loans are down to zero.
Consolidate all your high interest credit card balances
With the interest rate falling many credit card companies will let you transfer your debt to other credit cards. This could extend your grace period from 12 to 20 months with lower interest or even 0% interest.
There is usually a balance transfer fee in the range of 3% to 5% for you to consider.
But just a little discipline you can knock down all those debts sooner than later.
Strategize and win
Don’t get lost in the debacle when the stock market turns on the downside and listen to all the talking heads in the business news channels.
There are opportunities for your specific situation in downturns like this and all you need to do is strategize and win. So, take advantage and save money to gain better financial standing.
