I have a friend who asked me a question: Assume that one has a mortgage, fixed rate for 30 years (say at a rate of 5.5% with 20 years remaining). Since the interest rate is now low, are there ways to hedge the current mortgage to profit from lower interest rates, without redoing a new loan? Do you have ideas on how to do it?
This has been discussed a number of times... There's a variety of options. Unfortunately, they all have their flaws.
Thanks Martin. I knew that if I had to bet on who would answer first, it would be you. Any links, or should I just be ordered to hit the search button?
Let me find one of the old threads... Here: http://www.elitetrader.com/vb/showthread.php?s=&threadid=172041