Homeowners with five percent fixed-rate mortgages should consider refinancing given the recent American job report and its potential impact on interest rates.

Chief Analyst Sune Malthe-Thagaard from Totalkredit advises homeowners with a five percent loan to discuss their options with their bank advisor, emphasizing the importance of preparedness when favorable conversion opportunities arise, as quick decisions may be necessary.

The poor American job figures have increased the likelihood of an American interest rate cut, which has driven up the price of 3.5 percent loans, reducing the price loss associated with a conversion.

However, Malthe-Thagaard does not anticipate a major conversion wave immediately, noting that prices typically need to reach around 98 before a significant increase in conversions is observed.

He also points out that some homeowners with five percent loans have already converted to variable interest rate loans, reducing the overall conversion potential compared to previous instances.

Malthe-Thagaard outlines several potential scenarios for mortgage rate developments in the coming months, contingent on the state of the American economy and interest rates.

The impact of Trump’s tariff policy remains a key factor, with potential for interest rate cuts if the policy significantly weakens the economy.

Conversely, if the weak job figures prove temporary and other economic indicators show improvement, interest rates are likely to remain stable.

Friday’s bond market price declines resulted in the average price of the 30-year four percent loan exceeding 100, effectively making the 3.5 percent loan the primary offering, which comes with a lower interest rate but a larger initial price loss.