The good news is that refinance mortgage rates are currently at the lowest point in history, providing opportunity for homeowners to refinance into some outstanding financially beneficial home loans. The bad news is that there are many areas in the country that have experienced huge drops in home value and may exclude people from the best deals or from refinancing altogether.
Frequent readers of the Refinance Tool Box blog, are aware that home value is a crucial factor in taking advantage of a home refinance with today’s current low refinance rates, so I wanted to outline some of the areas hit hardest by the home value plunge.
Las Vegas may have been the most affected housing market in the US. More than 81 percent of single-family home mortgages in Las Vegas had negative equity in the fourth quarter of 2009, according to Zillow. Home prices in Las Vegas fell more than 56 percent from 2006 to the third quarter of 2009.
Many parts of California have been hard hit with home price declines, including Mercred, which saw home prices jump nearly 129 percent from 2002 to 2006, only to crashe more than 72 percent through the third quarter of 2009.
Arizona has been another state hit hard by home price declines. The housing market in Phoenix as an example saw home prices drop more than 52 percent from their peaks through the third quarter of 2009. As of the fourth quarter of last year, nearly 62 percent of single-family home mortgages were underwater, according to Zillow.
Florida is another big loser in the home value market over the past couple of years. For example, Orlando experienced a nearly 48 percent drop from the peak through the third quarter of 2009 and this has pulled 58 percent of single-family home mortgages in Orlando underwater, according to Zillow.
These figures are astounding and should point out the merit of checking on the current market value of your own home, before jumping in to the refinance application phase of refinancing. Many refinancing homeowners apply for loans stating home values of 2006 and prior, which could be way off the mark, especially if the home is in one of the hard hit areas of the US.
It can be all too easy for some mortgage loan officers to take an application with a “suspect” inflated home value estimation and wait for the appraisal to come in, just to see if it sticks. Depending upon how low the appraisal comes in, the refinancing homeowner could end up with a deal much less beneficial than thought originally, or maybe no benefit at all.
Refinancing homeowners can check numerous free resources online that offer home estimation tools based on home comps in the area. You can even go one step further and check recent home sales in your area at the local county. This bit of extra work can help a mortgage applicant to avoid a drastic home value surprise when the appraisal comes in.
If you are considering a home mortgage refinance now and need some help, have questions, or need some competitive refinance rate quotes, please check out the popular Refinance Tool Box. Just give a call at 888-850-9888 or fill out a Rate Quote Request online for professional assistance without the aggressive high-pressure sales tactics.
May the Mortgage Refinance Rates be with You!
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