Real Estate Insights

News provider US News & World Report recently put together a list of the top five ways that consumers may be able to best enjoy the benefits of today’s low interest rates. Some of these tips could help the average consumer save close to thousands of dollars a year…imagine how much you could save if you could take advantage of them all.

1. Consolidate your debt

First and foremost, when interest rates are low it is a great time to consider debt. By combining high interest car loans, school loans, credit cards, and other debt into a single low interest loan, you can not only save money, but also reduce the number of payments you make each month. Additionally, given the current economic climate, many creditors are more willing than ever to settle those high interest balances that are impossible to pay down.

2. Borrow money (virtually for free) from your credit cards

Following along the same line of thought as consolidating your debts, today’s best balance transfer-offers give you interest free money for 21 months (assuming you don’t miss your payments). This is HUGE considering that just a year ago, the best deals were only offered for just 12 months. And on top of the longer transfer period, balance transfer fees on these offers are down to 3 percent from what use to be 5 percent.

3. Refinance your mortgage

Refinancing a mortgage is a well known way to save a lot of money over the life of your home loan. Unfortunately not everyone is eligible for refinancing since today’s mortgage qualifiers are so strict, but it’s still possible for those lucky enough to still have equity in their home, that have managed to keep their credit scores up, and have steady income.

4. Refinance your car loan

While most think of refinancing a mortgage, many can save a substantial amount of money by refinancing your car loan. And if you happen to be a member of a credit union, be sure to check out their interest rates as they can be more competitive on the rates that they offer their members.

5. Buy a home

The combination of low rates and falling real estate prices make for a perfect time to buy a home. Some say home values may still fall over the next year, but rates are volatile, so knowing exactly when to buy can be a bit of gamble.

Plus, owning a home may actually help lower monthly expenses…It may sound counter intuitive that buying something can provide savings, but considering that in some metropolitan areas consumers may be spending more on monthly rents than they would on their mortgage payments given the extremely low interest rates we’re currently experiencing. Add the tax saving benefit provided by the mortgage interest deduction and considering future long-term appreciation, it’s no wonder that purchasing a home could be the best opportunity provided by today’s low interest rates.