What refinance benefits can homeowners expect if mortgage rates drop?

If mortgage rates drop one hundred basis points, on a four hundred thousand dollar loan, monthly payments could decrease by about two hundred fifty to three hundred dollars, depending on credit score and loan term. Buyers modeling a refinance plan can budget accordingly and use seller credits for a two-one buydown, temporarily lowering initial payments. This strategy helps manage cash flow before a refinance within twelve to twenty four months becomes feasible.