A Huge Number of Homeowners Have Mortgage Rates Too Good to Give Up

Yup. Bought at the end of 2019, refinanced in late 2020. Currently have a 15 year mortgage at a fixed 2.1% APR. I literally cannot afford to give this up.

It's less that I want to leave this house, specifically, and more that I just want out of this state. For multiple reasons unrelated to my good mortgage deal, I'm stuck here for the foreseeable future.

On the bright side, I never thought I'd actually own a house so I'll take the win.

I recently gave up my 3% mortgage from 2013 in exchange for a 7% mortgage. It hurts, but it was worth it to get out of Florida.

In the end, my housing costs actually didn't change that much because my home insurance rates were skyrocketing.

I'm in year 17 of my 5 year starter home. I can't afford to upgrade now. I'm gonna die in this house.

Same story as everyone else. Bought pre-covid, refinanced, now sitting pretty. We desperately want to move, but I would have to make like $50k more a year for the same quality of life.

Had 30 yr 3.84%, refinanced in 2021 to 15 yr 1.999%. it's the cheapest money I'll ever have.

Kinda strange reading all these comments about how people dislike their house and where they live, but can't imagine giving up their mortgage rate.

The almighty mortgage handcuffs, the true American dream.

2.875 here, my monthly payment is $545. I want to move, but it would be financially stupid to do so

Oh, yeah. This isn't the house I wanted to die in, but unless we have another near-negative interest rate drop, we're here for the long term.

"Are you willing to relocate?" has now become a hard "no."

And people moved away from cities during COVID to decrease their cost of living and get a bigger place while still being able to work from home. They bought with lover interest rates in their mortgage.

Now employers want a return to office. The employees can't afford to move back.

Are we like not even allowed to talk about renting out our home in order to upgrade or something? That's the play right now. Net present value of your almostfree money is maximized by turning it into cashflow. Plus you don't blow 6% on closing costs, and it's all the same to the bank in terms of getting another loan. It actually ends up being an equity asset as well as income.

Err, what I meant to say was murder all landlords.

Bought my house just before the crash in 2007. Felt screwed over as I went underwater and was stuck with my 6.5% loan while interest rates and home values plummeted (and because my mortgage was privately held, no HARP refi option.

Finally after nearly 15 years not only go out from under water but built enough equity for a no cost refinance. Got into a 2.25% loan.

Sad part is, despite the lower rate, due to skyrocketing insurance and taxes, my payment is no cheaper

3.25% 30 year... 27 years left.

But I'm OK staying. I've made huge improvements. Upgraded the electrical panel from 100A to 200A, added solar panels, added a retractible awning. Hot tub is coming.

It's a nice house, with a good yard, will be fun to add playground stuff when we have grand-kids.

I’m one of them. For a lot of reasons my partner and I want to move, but we have a 3% mortgage. Even though we have a large amount of equity, we still can’t afford to buy now. I’m looking a getting a loan from my parents, which is ridiculous considering our situation but almost 8% interest rates mean our payment would just about double from what we have now.

Lucky 'mericans. In Canada, fixed mortgages are still renegotiated every 5 years or so, nearly every homeowner with a mortgage is getting wrecked by the interest rates.

Its less of a problem of lock in here in Australia. Our rates tend to only be fixed for the first few years. Then you go to the variable rate. We have an opposite problem, where we have what's known as a mortgage cliff. People who signed up at affordable repayment amounts end that lock in period and have payments jump significantly. Some are forced to sell.

Being locked in seems better than being forced to sell.

3.6 here (bought 22) and not fucking moving until rates are at least below 4 again. If that means I don’t ever move again then so be it

2.75% here. Yeah... I don't like where I live but I ain't moving unless I have to

The dropping interest rate is one of the main reasons that housing prices have skyrocketed in the past 20 years. People judge housing prices by what they can afford monthly and interest rates directly impact that figure. It's only a matter of time for housing prices to fall drastically if interest rates remain at 7%.

And yes, I have a 500k loan at 2.5% on a 30yr fixed mortgage. Maybe we'll sell our house in 15 years, but otherwise, forget it! I have zero interest in paying it off early.

My wife and I were lucky enough to be able to purchase a home at a decent rate and then refinance a few years later to an even better rate (around 3.5%). We bought in 2019, when the world was still somewhat sane. The thought of trying to sell and get a new home at the higher rate makes me sick to my stomach and I feel bad for my brother-in-law.

When we were buying (2019), my in-laws were pushing for us to just get a starter home, and then upgrade in a few years. Both my wife and I were like "no, we're buying once and being done with." So we went a little higher than I was comfortable with.

However, our house has increased by 50% since we bought it, and we were able to refinance to 3% during the pandemic. Which was and is fantastic. But, yeah, we don't even think about moving now.

Part of me wishes to move. It's like you have to buy the house in cash now. What a time to be alive.

We have similar stories to the others, but also, we bought a house in a less-than-desirable town. So even if we could afford a higher mortgage rate, our house isn't worth enough to move somewhere more desirable.

Just before the insane rises, we were remortgaging with a slight increase in borrowing for a loft conversion. In July I was kicking myself as the original rate in the March before was 1.7% as it had just increases to 3% which I wasn't happy about. A couple month later it was 7%!

I told my cousin to pick up a condo he liked in 2019. His cheap ass decided to wait. The condos in that building more than doubled in price and the rates tripled.

It's a general problem in real estate now; commercial and residential.

Everyone who was able to refinance to low mortgage rates locked them in. That means that just about anyone who wants to roll over a real estate investment has to take a huge hit in the process. Those rollovers are normally a big part of liquidity and they've all dried up.

this is the problem and not people transferring 15% of the housing market into short term rentals.

/raises hand

People forget .... If you refinance you are essentially selling the house to yourself with the lower rate, but Mr. Taxman will up your taxes to the current market value of your home, which is ridiculously high right now. Any savings in interest goes back into higher taxes. And now you will need more expensive insurance to cover the increase in home value.

I have a feeling something will happen that will make them unstuck so that investment firms can scoop them up too.