Mortgage rates are falling rather dramatically right now. After the Fed slashed the Funds rate on Tuesday, mortgage interest rates have followed suit. They are now at a 37-year low of 5.19% for a 30-year fixed. It’s enough to make me want to refinance. Seriously.

And it is no surprise that refinancing is suddenly very popular right now. People are trying to take advantage of these great rates. However, if you want to refinance to a lower 30-year fixed rate, there are some things that you need to consider:

• Equity in your home.
• Whether you qualify to refinance.

One of the problems that some are running into is that these lower rates are useless because banks are not lending. My problem is that I’ve only been in my home for a year, and I may not have sufficient equity for a refinance. Maybe I’ll check with my credit union. It never hurts to ask.

If you do refinance, aware that now may not be the best time for a cash out refinance. Instead, just refinance what you owe, and enjoy the equity in your home and the lower mortgage payments.

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