Everything was laid bare.
Lowering the monthly mortgage payments on Holmes' one-story Alexandria home was not the easiest of tasks.
But the efforts paid off.
"I'm saving a little over $500 a month on my payment," Holmes said. "I wasn't expecting that much so I was pleasantly surprised."
Holmes, a school bus driver and self-employed landscaper, wanted to save money on his mortgage payments and took advantage of historically low interest rates to do so. A growing number of Holmes' fellow homeowners are doing the same, out of concern that those rates could soon rise again. The rush to refinance is boosting business for banks and credit unions, local financial experts say.
"The refinancing market is definitely something we've seen a lot of activity in," said Richard Simonton, president and CEO of AOD Federal Credit Union, which has branches in Oxford, Anniston and Jacksonville.
Simonton said the growth in home mortgage refinancing in recent years is due to the current level of interest rates, around 3.75 percent. The mortgage interest rate is basically the extra money a person agrees to pay a lender for the privilege of receiving a loan to buy a house.
The federal government has kept interest rates at historic lows for several years to stimulate the housing market. The market crashed in 2008 and the Great Recession soon followed, forcing mass layoffs and economic stagnation. The housing market has yet to fully recover.
However, the market has recovered enough that more homeowners are ramping up refinancing efforts out of concern that the government will soon raise interest rates, said Shad Williams, president and CEO of Cheaha Bank in Oxford.
"People like to refinance when rates are at the absolute bottom," Williams said. "People are realizing now that rates are not going any lower."
Williams said his bank has a steady stream of mortgage refinances to work through this year.
Bob Sargent, an area manager for Wells Fargo Home Mortgage, whose includes territory includes Anniston, said his employer has seen increased business in recent years due to mortgage refinancing. Sargent said homeowners, not banks, are driving the growth in refinancing by taking advantage of low interest rates
"You can't just refinance for the heck of it," Sargent said. "There always has to be a benefit to the borrower ... they have to be able to save some money to refinance."
AOD has one person in its mortgage department but the credit union plans to soon add more people, Simonton said.
"We're definitely seeing an uptick in refinancing and that's why we're looking to hire more people," Simonton said.
Simonton said AOD also recently lowered its rates to be more competitive, offering now a 15-year fixed-rate mortgage loan with no origination fee. An origination fee, or activation fee, is a payment associated with the establishment of an account with a company that provides loan services. The lack of an origination fee will save customers between $500 and $1,000, Simonton said.
The refinancing deal will still require closing costs, which can include appraisal and inspection fees, and will range between 2 percent and 3 percent of the loan amount, Simonton said.
Sargent said more people are refinancing also because of programs including the federal Home Affordable Refinance Program or HARP. The program is available for people whose homes are worth less than what is owed on them. Many homeowners discovered after the housing market crash that their homes were underwater — worth less than they owed on the mortgage. HARP can help such people acquire a more affordable mortgage payment, Sargent said.
"Someone might owe $125,000 but their house is only worth $110,000," Sargent said. "Now with HARP, these people have the opportunity to be helped."
Sargent said it doesn't hurt a homeowner to visit their bank to discuss refinancing their house.
"You've got nothing to lose right now," he said.
Staff writer Patrick McCreless: 256-235-3561. On Twitter @PMcCreless_Star.