{"id":39347,"date":"2016-07-09T08:00:06","date_gmt":"2016-07-09T12:00:06","guid":{"rendered":"http:\/\/www.ino.com\/blog\/?p=39347"},"modified":"2016-07-08T11:43:47","modified_gmt":"2016-07-08T15:43:47","slug":"how-to-profit-from-brexit-guaranteed","status":"publish","type":"post","link":"https:\/\/wwwtest.ino.com\/blog\/2016\/07\/how-to-profit-from-brexit-guaranteed\/","title":{"rendered":"How To Profit From Brexit - Guaranteed!"},"content":{"rendered":"<p style=\"margin: 0 0;\"><img loading=\"lazy\" decoding=\"async\" src=\"\/\/www.ino.com\/blog\/wp-content\/uploads\/2014\/12\/GeorgeYacik_Contributor_ImageBadge350.png\" alt=\"George Yacik - INO.com Contributor - Fed &amp; Interest Rates\" width=\"350\" height=\"131\" class=\"alignleft size-full wp-image-30496\" style=\"padding-top: 10px;\" srcset=\"https:\/\/www.ino.com\/blog\/wp-content\/uploads\/2014\/12\/GeorgeYacik_Contributor_ImageBadge350.png 350w, https:\/\/www.ino.com\/blog\/wp-content\/uploads\/2014\/12\/GeorgeYacik_Contributor_ImageBadge350-300x112.png 300w, https:\/\/www.ino.com\/blog\/wp-content\/uploads\/2014\/12\/GeorgeYacik_Contributor_ImageBadge350-270x100.png 270w\" sizes=\"(max-width: 350px) 100vw, 350px\" \/><\/p>\n<p style=\"margin: 0 0;\"><br style=\"clear:both;\"><\/p>\n<p>With interest rates plunging all over the world, including right here in the U.S., many fixed-income investors are scratching their heads about where they can find something that pays more than 1% without taking on a pile of risk.<\/p>\n<p>The answer is right under their noses. Plus, the return is way better than you can get on stocks and bonds (even gold!). Not only that, but the return is guaranteed. <\/p>\n<p>What is this magic investment?<!--more--><\/p>\n<p>It\u2019s called your mortgage.<\/p>\n<p>Over the past several years, millions of homeowners have refinanced their mortgages at super low rates, so many people think they can\u2019t do any better. Not true.<\/p>\n<p>With the yield on the benchmark 10-year Treasury note falling below 1.40%, a record low, mortgage rates are moving down along with it.<\/p>\n<p>A new report from Deutsche Bank estimates that about two-thirds of homeowners with a mortgage can now benefit from refinancing into a 3.5% or lower mortgage, which is where long-term rates are now \u2013 and may be going lower still.<\/p>\n<p>The fact is, people who have already refinanced can do so again and save even more money, or reduce the term on their existing mortgage, in the process paying down their loan a lot faster and getting closer to the day when they can burn their mortgage and own their home free and clear.<\/p>\n<p>Let\u2019s say you currently have a $300,000 30-year home loan with a 4.5% interest rate. Not too shabby. However, it does look a bit ragged compared to today\u2019s rates, which have dropped to near 3% in the wake of the Brexit vote.<\/p>\n<p>The principal and interest payment on your current loan is $1,520. If you refinanced into a 3.5% loan, your P&I payment would be $1,347, a savings of $173 a month. <\/p>\n<p>With your current loan, you\u2019d pay almost $250,000 in interest over the life of the loan. By refinancing into a 3.5% mortgage, you\u2019d pay about $185,000 in interest. Over 30 years, the savings would be $65,000. Assuming closing costs of about $6,000, you\u2019d make more than 10 times your original investment plus your return would be guaranteed, unless you sold the house in the meantime or refinanced again. Not even Bernie Madoff could offer that kind of return.<\/p>\n<p>You might also think about refinancing into a shorter-term loan, enabling you to pay off your mortgage a lot faster than you are now. That could be a big issue if you\u2019re staring retirement in the face and don\u2019t want to still be saddled with a mortgage payment every month after your regular paychecks stop.<\/p>\n<p>Rates on 15-year mortgages are currently at 3% or less. Refinancing into a 15-year loan at 3%, your monthly P&I payment would be $2,071, or about $551 more than you\u2019re paying now. But if you could swing that, you\u2019d pay only $73,000 in interest over the life of the loan, or $177,000 less than you would pay if you stuck with your current loan. Now you would make more than 30 fold on your investment in the refi and over just 15 years. On top of that, you wouldn\u2019t have to worry about coming up with $1,520 every month on a reduced retirement income.<\/p>\n<p>There are also a lot of people who still haven\u2019t taken advantage of the Home Affordable Refinance Program, better known as <strong><a href=\"http:\/\/www.harp.gov\/Eligibility\" target=\"_blank\">HARP<\/a><\/strong>. But you better hurry \u2013 the program expires at the end of the year. Although the program has been extended a few times already, there hasn\u2019t been much talk about extending it yet one more time. Then again, if the presumptive Democratic candidate for president should stumble on her way to the election, there\u2019s no telling what goodies her cronies in the Administration will come up with to persuade voters to see the light.<\/p>\n<p>HARP has to be one of the biggest financial no-brainers of all time, yet a lot of people, I\u2019ve read, seem to think it\u2019s a scam. Maybe because it sounds too good to be true, but in this case it really is true. I should know, since I did a HARP refi a few years ago and smile every time I open my mortgage statement. The rate on our mortgage was cut nearly in half, plus we went from a 30-year to a 20-year mortgage with the exact same monthly payment.<\/p>\n<p>If you\u2019re not familiar with it, the government rolled out HARP back in March 2009 to help homeowners refinance their mortgages at current rates, even if they\u2019re \u201cunderwater,\u201d or owe more than their home is worth. It was the least the government could do after giving billions of dollars of bailout funds to commercial banks, who largely started the mortgage mess, hand in hand with the federal government. But I digress.<\/p>\n<p>The eligibility rules are pretty simple, and also pretty easy to meet. You don\u2019t need a property appraisal. Usually, there\u2019s no minimum credit score, and there\u2019s no limit on how underwater your mortgage is. Click <a href=\"http:\/\/www.harp.gov\/Eligibility\" target=\"_blank\">here<\/a> to find out more, or call your friendly neighborhood mortgage lender.<\/p>\n<p>Visit back to read my next article! <\/p>\n<p><a href=\"http:\/\/www.ino.com\/blog\/meet-george-yacik\/\" target=\"_blank\">George Yacik<\/a><br \/>\nINO.com Contributor - Fed & Interest Rates<\/p>\n<p><span style=\"font-size: 12px; font-style: italic;\">Disclosure: This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.<\/span><\/p>\n<!-- AddThis Advanced Settings generic via filter on the_content --><!-- AddThis Share Buttons generic via filter on the_content -->","protected":false},"excerpt":{"rendered":"<p>With interest rates plunging all over the world, including right here in the U.S., many fixed-income investors are scratching their heads about where they can find something that pays more than 1% without taking on a pile of risk. The answer is right under their noses. Plus, the return is way better than you can [&hellip;]<!-- AddThis Advanced Settings generic via filter on get_the_excerpt --><!-- AddThis Share Buttons generic via filter on get_the_excerpt --><\/p>\n","protected":false},"author":16,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6920],"tags":[8483,8508,8319,8506,6938,8509,7575,8507],"class_list":["post-39347","post","type-post","status-publish","format-standard","hentry","category-ino-com-contributors","tag-10-year-treasury-note","tag-15-year-mortgages","tag-brexit","tag-fixed-income-investors","tag-george-yacik","tag-harp","tag-home-mortgage","tag-refinancing"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v23.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How To Profit From Brexit - Guaranteed! - INO.com Trader&#039;s Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ino.com\/blog\/2016\/07\/how-to-profit-from-brexit-guaranteed\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How To Profit From Brexit - Guaranteed! - INO.com Trader&#039;s Blog\" \/>\n<meta property=\"og:description\" content=\"With interest rates plunging all over the world, including right here in the U.S., many fixed-income investors are scratching their heads about where they can find something that pays more than 1% without taking on a pile of risk. 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