Homeowners who have been holding out on refinancing their homes are about to be rewarded.

Annamaria Andriotis from the Wall Street Journal stated in her December 31st post, “The average interest rate on a 30-year mortgage fell to 4.05% for the week ended Dec. 23, the lowest in 60 years, according to HSH Associates, a mortgage-data firm. And rates on jumbo mortgages—private loans that in most parts of the country are larger than $417,000—also have hit new lows, averaging 4.61%.”

The Savings Can Be Impressive For Homeowners.

Due to the new low rates, banks have been creating specific incentives to get homeowners refinancing and taking advantage of these excellent deals. For example, New Jersey homeowners are now charged a flat fee of $499 by Valley National Bank for closing costs on mortgages as high as $1 million, and since closing costs typically run around 2% of the total loan, that’s a significant savings. Around $15,500 for a person with a mortgage of $800,000.

Another example of excellent discounts involves Union Bank. Most banks will only refinance mortgages under $2 million, but Union Bank will refinance mortgages up to $4 million for it’s customers. This is an effort to bring more high-net-worth customers into the bank.

While the majority of homeowners in the United States are in this bracket, it’s a positive sign of an impressive mortgage rate and homeowners cashing in on the savings.

Current Refinance Rates (as of 1/3/2012)

The following rate information is taken from MonitorBankRates.com

Conforming Adjustable Home Loans

• 1 year adjustable refinance rates today are averaging 3.63%, down from last week’s average 1 year adjustable jumbo refinance rate of 3.71%
• 3 year adjustable refinance rates current are averaging 2.54%, down from last week’s average 3 year adjustable refinance rate of 2.71%
• 5 year adjustable refinancing rates are averaging 2.83%, up from the prior week’s average 5 year adjustable refinance rate 2.73%
• Current 7 year adjustable refi rates are averaging 2.91%, down from the previous week’s average 7 year adjustable refinance rateof 3.00%
• 10 year adjustable refi rates currently are averaging 3.50%, a decline from last week’s average 10 year adjustable rate of 3.54%

Adjustable Jumbo Loans

• Current 1 year adjustable jumbo refinance rates are at 4.50%, unchanged from last week’s average adjustable jumbo refinance rate
• 3 year adjustable jumbo refinance rates today are averaging lower at 3.36%, unchanged from last week’s average 3 year jumbo adjustable refinance rate
• 5 year adjustable jumbo refinance rates currently are averaging 3.00%, down from last week’s average jumbo adjustable refinance loans rate of 3.07%
• 7 year jumbo adjustable refinance home loan rates today are averaging 3.47%, down from last week’s average 7 year adjustable refinance home rate of 3.50%
• 10 year jumbo home refinance rates are averaging 3.82%, down from the prior week’s average 10 year jumbo refinance rates of 3.90%

Conventional Adjustable IO Adjustable Home Loans

• 3 year interest only adjustable refinance rates and are averaging 3.21%, down from last week’s average interest only refinance rate of 3.22%
• 5 year IO adjustable loan refinance rates today are averaging 2.89%, a decrease from last week’s average five year interest only home refinance rate of 2.97%
• 7 year interest only adjustable loan refinance rates are averaging 3.16%, down from last week’s average 7 year interest-only refinance rates of 3.25%

Adjustable IO Jumbo Loans

• Today’s 3 year jumbo refinancing rates are averaging 3.66%, up from last week’s average jumbo adjustable interest only refinance rate of 3.62%
• Current 5 year adjustable jumbo interest only refinance rates are averaging 3.38%, down from last week’s average IO home refinance rate of 3.48%
• Today’s 7 year jumbo interest only adjustable refinance rates are averaging 3.64%, down from last week’s average jumbo 7 year home refinance  loan rate of 3.76%

Huffstetler states that in less than three hours, she can help get a household’s finances back in working order.

So here’s some tools needed:

• A copy of your bills
• A calculator
• Pen and paper

Remember, for the advice to actually improve a financial situation, keep the following in mind:

1. Be honest about spending habits; how much is spent every month?
2. Make sure to leave room in monthly budgets for fun and entertainment; budgeting isn’t about total deprivation.
3. A budget can change; a good budget should be continuously evolving.

Let’s get started:

1. Examine monthly expenses: Make a list of all typical expenses in a given month.
2. Total monthly earnings: How much money is needed each month?
3. Subtract expenses: Subtract monthly expenses from your monthly earnings.
4. Rework the month: If the budget comes out in the negative, rework it. Look for places to cut costs.
5. Leave room for debt reduction: The monthly budget should ALWAYS include the minimum payments needed each month to help pay off debt.
6. Make room for savings and investment: Emergency fund? Retirement investments? Vacation funds? Make a list, and start saving for the future.
7. Get the budget back to work: The month is planned and thoroughly budgeted—now, it’s time to put it to the test!
8. Assess and reassess: As Huffstetler states, “A frugal budget is never finished!” Budget every month for areas of overspending. Look for ways to reallocate funds.