SOFR is very closely related to the fed funds rate. If you believe the forward curves and expectations that the Fed will begin a rate cut cycle, that SOFR + 2% rate could fall to 5.5% (or lower) in the next 12 months.
If your monthly budget allows for it and you have the right risk appetite, you could ride out the floating rate mortgage over the 23-year remaining amortization term and not have to mess with the hassle of the refi fees and paperwork.
With the 15-year mortgage, you are locking in the rate immediately with a higher mandatory principal payment due to the shortened amortization period.
It’s a personal decision and I could go either way…. Maybe wait 6 months to see if rates drop further on the 15-year mortgage before pulling the trigger?
If your monthly budget allows for it and you have the right risk appetite, you could ride out the floating rate mortgage over the 23-year remaining amortization term and not have to mess with the hassle of the refi fees and paperwork.
With the 15-year mortgage, you are locking in the rate immediately with a higher mandatory principal payment due to the shortened amortization period.
It’s a personal decision and I could go either way…. Maybe wait 6 months to see if rates drop further on the 15-year mortgage before pulling the trigger?
Statistics: Posted by sphinx2020 — Sat Aug 31, 2024 7:22 pm