Mortgages are often the biggest financial burden on any budget. In light of the current economic environment, the Federal Reserve has cut interest rates to spur the economy. A benefit of this cut is that mortgage lenders followed suit and similarly slashed their interest rates to historic lows. This is good news for those who want to buy property, have a high-interest rate they want to refinance or have a change in circumstances, such as a new job or divorce.
Buying during a pandemic
Realtors report that families in quarantine realized that they needed different living spaces. Common reasons include:
- Wanting to leave a multi-unit condominium building with an abundance of public space.
- Needing a larger living space to accommodate families living and working under the same roof day and night.
- Leaving a large city for better weather and the more spread out layout here in Naples.
Refinancing also a good option
Those currently living here fulltime or for part of the year may simply look at this as an opportunity to refinance. There are many good reasons for doing it:
- Lower monthly payments: Amidst the financial uncertainty of 2020, lowering a monthly payment enables families to set aside more income for a rainy day fund or other investment opportunities.
- Cash-out: There may be an opportunity to take money out of the home for a downpayment on a second home or pay down high-interest debts.
- Change the loan term: Homeowners can reduce the number of payments by shortening the duration or lengthening the mortgage to spread out over a longer period.
- Change the rate: Perhaps it makes sense to switch from an adjustable-rate to a fixed-rate.
- Eliminate PMI: Private mortgage insurance may no longer be necessary.
Legal guidance often necessary
Real Estate attorneys often provide invaluable help to clients purchasing or selling property here in Florida. They can help clients determine the best course of action for structuring the deal, getting a mortgage, and addressing other financial or legal issues that arise during the transaction.