Increases in short-term rates lead many military families to replace "no-ceiling" HELOC debt with 30-year fixed-rate loans from AAFMAA Mortgage Services. HELOC (home equity lines of credit) rates are going up with the prime rate, and many banks now offer rates exceeding 4% (with no ceiling or cap on the interest rate). At AAFMAA Mortgage Services, military families receive expert advice from state-licensed loan officers capable of providing money saving solutions.
The Federal Reserve recently raised short-term interest rates, which caused a decline in long-term fixed rates. This provides a unique opportunity for military families to refinance from volatile short-term adjustable HELOC rates into 15- or 30-year fixed-rate loans. The New York Federal Reserve reported that HELOC debt has been falling as consumers secure less volatile fixed-rate debt.
Roughly $500 billion in HELOC debt will likely refinance into 30-year fixed mortgage rates over the next several years, according to Andy May, AAFMAA Mortgage Services COO. Most HELOCs have no rate ceiling to cap how high the interest rate may climb. Military families with HELOCs should assess the terms and rates paid, determine whether or not a rate ceiling exists, and lock in protections against further rate increases. Military families should consult with state-licensed loan officers to see if they would benefit from refinancing to a 30-year fixed-rate loan.
Contact AAFMAA Mortgage Services today at 844-4-AAFMAA (844-394-4526) for a free rate quote.
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