COVID-19, also known as coronavirus, has changed everything. We're all making the necessary changes and adjusting to the uncertainty and general weirdness that this virus has caused. While even financial experts are unsure about what will happen next, there are a few clues that we can hone in on to prepare mortgage-wise for the upcoming months.
With mortgage rates dropping, is it still a good time to refinance during the pandemic?
Here's what you need to know about refinancing amidst the 2020 pandemic.
COVID-19 has disrupted the market in unique ways. We'll discuss those ways in just a moment, but first, let's look at what usually causes mortgage rates to drop and what the typical response is.
What we typically see when people are uncertain about the future of the economy is that they move their higher investments like stocks into lower-risk investments like bonds.
Now, the mortgage-backed securities (MBS) is a major investment that is backed by the monthly mortgage payments and these securities are sold in the bond market.
MBS tends to be in higher demand when people move into the bond market during times of uncertainty. And when the demand for the securities is high, the rate of return doesn't have to be. The result is usually lower mortgage rates.
However, the current situation with COVID-19 is different.
COVID-19 is causing the market to be more unpredictable than it typically would during a crisis. Here are a few reasons why the market is reacting this way:
Here is another important fact to note: The mortgage process is considered an ESSENTIAL financial transaction.
Since housing is so significant to the economy, the Federal Reserve sometimes intervenes to stabilize it by buying up lots of MBS. This action helps to keep mortgage interest rates low and encourage people to buy homes.
Although we don't know all of the details of the recently passed a $2.2 trillion aid, the Feds have several courses of action to keep mortgage rates at a favorable level for homebuyers and homeowners. They stated that in addition to an emergency rate cut, they would do as much purchasing in the financial markets as is necessary to help ward off any economic downturn caused by the virus.
Here's what it boils down to: Rates are still low, your home is your most significant financial investment, and your home equity can provide financial stability you need in times of trouble.
There are still many things to consider before deciding definitely if this is the right more for you. So we encourage you to contact us today to set up a consultation. The sooner we get started, the sooner you have access to your home equity.
The mortgage process is considered an ESSENTIAL financial transaction and critical to the economy. Rest assured that our office is equipped and connected with everything you need to expedite your loan and answer your questions.
We've been helping customers afford the home of their dreams for many years and we love what we do.
Company NMLS: 235599
Real Estate Broker – CA Dept of Real Estate – Lic #01851459 – NMLS #235599
426 Sutton Way Ste 114
Grass Valley, California 95945
Nevada County Mortgage strives to ensure that its services are accessible to people with disabilities. Nevada County Mortgage has invested a significant amount of resources to help ensure that its website is made easier to use and more accessible for people with disabilities, with the strong belief that every person has the right to live with dignity, equality, comfort and independence.
Nevada County Mortgage makes available the UserWay Website Accessibility Widget that is powered by a dedicated accessibility server. The software allows nevadacountymortgage.com to improve its compliance with the Web Content Accessibility Guidelines (WCAG 2.1).
The Nevada County Mortgage accessibility menu can be enabled by clicking the accessibility menu icon that appears on the corner on the page. After triggering the accessibility menu, please wait a moment for the accessibility menu to load in its entirety.
Nevada County Mortgage continues its efforts to constantly improve the accessibility of its site and services in the belief that it is our collective moral obligation to allow seamless, accessible and unhindered use also for those of us with disabilities.
Despite our efforts to make all pages and content on Nevada County Mortgage website fully accessible, some content may not have yet been fully adapted to the strictest accessibility standards. This may be a result of not having found or identified the most appropriate technological solution.
If you are experiencing difficulty with any content on Nevada County Mortgage website or require assistance with any part of our site, please contact us during normal business hours as detailed below and we will be happy to assist.
If you wish to report an accessibility issue, have any questions or need assistance, please contact us by sending an email to: email@example.com