QUESTION: My mortgage rate is about 6% and the rate will be adjusted in 2012. When should I refinance?

ANSWER: As soon as possible. Interest rates have recently dropped but this dip will probably be temporary. Act now to refinance before interest rates continue their upward trend. The reason why interest rates will rise is that mortgage interest rates are closely linked to the 10-year maturity U.S. Treasury note interest rate. In 3 months, the FED will probably stop buying these as part of its quantitative easing AND the Japanese, a big purchaser in the past, will be forced to withdraw their buying power in order to redirect its money to rebuilding Japan post earthquake/tsunami/meltdown.

Feel free to contact me if you or someone you know has this type of situation. Financial Planning and tax planning advice presented here is general in nature, and individual circumstances make applying these general rules tricky; thus, the above answer cannot be applied to all circumstances because the slightest variation could cause a different outcome.