Freddie Mac’s Primary Mortgage Market Survey found that 77 percent of refinancing homeowners either reduced or maintained their principal loan amount in the second quarter. Frank Nothaft, Freddie Mac’s vice president and chief economist, said savvy homeowners are taking advantage of the lowest fixed-rates in more than 50 years to lock in interest savings. More than 50 percent of refinancing homeowners maintained the same loan value, while 26 percent lowered their principal balance. The median interest-rate reduction for a 30-year fixed-rate mortgage was one percentage point, which would save $1,550 in interest payments on a $200,000 loan in the first year following refinancing. According to the survey, 30-year fixed-rate mortgages hit a low in June, averaging 4.50 percent. More here and here.
