Mortgage Rates Are Down Due to COVID-19. Should You Refinance?
1% for your mortgage loan? Not quite yet but soon. At the rate that SIBOR is collapsing over the last week, suddenly the prospect of your mortgage loan interest rate going all the way down to 1% turns into a posibility. However, you need to act fast.
3-month SIBOR has crashed from its most recent high of 1.71% (as of 24-Feb) just two weeks ago to the current 1.21683% (as of 12-Mar) – an incredible fall of over 20%. But that’s not the end yet.
With deepening spread of the covid-19 virus within the US, Fed will be expected to do more. If further cuts are made there is every possibility of SIBOR going to 0.80% within the next few months. At the moment, there are just two to three banks remaining still offering SIBOR floating rate home loan packages with ultra-thin spreads of just 0.15-0.20% in the first two years. If you quickly sign onto one of these loans, your interest rate will be 1% when the above scenario plays out. And perhaps at 1% for a good period time if interest rates continue to languish at such levels. This is not a gimmick.
So, this is an urgent call to all homeowners out there to contact our mortgage partner quickly! Especially if your current lock-in period ends within the next 6 months. This couldn’t come at a better time!
How often does one enjoy a near 1% home loan? Provided you act now! We expect lenders to withdraw such low-spread SIBOR home loans anytime within the next two weeks or even earlier. If spreads get revised up to 0.40-0.50%, you would have missed this “once-in-a-cycle” opportunity to lock down superb spreads and enjoy the prospect of a 1% home loan.
Remember spreads tend to come up when SIBOR goes down. This has always been the case. And that’s the reason why we have switched to recommending SIBOR mortgage pegs on floating rates since the start of 2019. That’s even before US Fed made a policy U-turn in March 2019 and started cutting interest rates three times last year. Clients who took our advice last year would have seen their interest rates rolling off over the course of the past year. There is still a small window for you to catch on to this ride. But closing fast.
Speak to our mortgage partner here for the best home loan rates today.