By John Wasik
(Reuters) – With home mortgage rates still hovering around record lows – and they may fall further still – this should be the perfect time to lower your borrowing costs.
Yet with tough standards and more people in a home-equity hole due to the housing slump, it’s difficult to get the best rates. There are some ways to improve your odds and a revamped government program might help, but you’ll have to jump through some hoops to sweeten your loan application.
Mortgage applications are surging, largely due to refinancings. Weekly applications climbed 4.1 percent through December 14, according to the Mortgage Bankers Association. The share of refinancing loans was the highest recorded rate this year.
Since there aren’t too many home buyers around, some 80 percent of mortgage activity is refinancing, according to the Mortgage Banker Association. But up to half of those applying for refis may not qualify, according to LendingTree.com, an online lending exchange.
If you’re looking for a loan and have a low credit score or are buying anything but a single-family home, the odds are you’ll pay higher rates, not the phenomenally low average rate of 3.9 percent for a 30-year, fixed-rate mortgage as of December 15.