Mortgage Refinancing

Refinancing - ARMs Good or Bad?

2005-01-27T16:02:00.000-08:00

Adjustable Rate Mortgages can seem like a great deal on the surface for those looking to refinance. While those low short term rates can be extremely attractive with monthly payments that more resemble that of a car payment than a home, keep in mind that in this low rate environment it is likely to adjust upward eventually. ARMs can be a good option but watch out for the fine print that could trap you in a loan that gets less appealing over time. Avoid prepayment penalties and look out for fees that are triggered by another refinance within a certain number of years. Whether you decide to go with a fixed rate or adjustable rate refinance, be sure to compare multiple lenders and shop around for the best deal that you can qualify for given your current credit situation. Here is a good place to start your search:

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Refinancing - YSP What?

2005-01-20T10:36:00.000-08:00

So what in world is a YSP and what does it have to do with my refinance you ask? The answer is everything. YSP or Yield Spread Premium as the industry refers to it, is a dirty little secret where banks will actually pay brokers to sell a borrower a rate that is HIGHER than the bank actually approved them for. This can cost you thousands of dollars. How can you avoid paying YSP on your refinance loan? Be wary of loans that offer a lower than market interest rate and claims to have no closing costs. These are prime candidates. Remember, there are good deals to be found but there is no such thing as free lunch in the financial services industry. The best way to avoid these hidden costs is to compare multiple lenders and read through all of the loan terms carefully. Lenders are required by law to disclose and document all fees involved with a loan. They just may not be upfront about it. Shop around until you find the right refinance option for you. Here is a good place to start your search:

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Refinancing - Watch Out for that Fee

2005-01-19T08:20:00.000-08:00

When most of us look to refinance our mortgage loan, the first question we ask a lender is: "What is your best rate?" While this is a key component of any refinance, there are plenty of other costs and fees that can make or break a good deal. Be sure to compare lenders based on the total cost of the transaction. Here are some common fees that should be considered:

1. Documentation Fees

2. Credit Check Fees

3. Underwriting Fees

4. Application Fees

Remember that most if not all of these fees are usually negotiable and can often times be reduced or eliminated entirely. Keep in mind that the lender is competing for your business and will typically make some concessions in order to keep you from working with another lender. Here is a good place to start if you need to compare several refinance options:

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Refinancing - What to Watch Out For

2005-01-17T10:33:00.000-08:00

We all know that there are hundreds of ways that the financial services industry can try to squeeze extra dollars out of you when you borrow money. Here are a few common tricks to watch out for when you are looking to refinance your mortgage.

1. Know who you are dealing with.

Are you working directly with a lender or a mortgage broker? Most people don't even know the difference between the two. A mortgage lender is an institution such as a bank, credit union, or mortgage company that provides loans directly. A mortgage broker arranges transactions rather than providing loans directly. There can be advantages and disadvantages to both. Mortgage brokers typically have access to dozens of lenders and a variety of different loan products while lenders have access to their own products only. Remember that just because a mortgage broker has access to more products and a potentially better deal, they are not obligated to find you the best possible product. Be sure to get quotes from several sources before deciding on which loan is best for you. The following link is a good place to start your search:

Refinance Your Home

2. Watch out for pre-payment penalties.

You finally got that great on your mortgage loan that you worked so hard to negotiate. Now you have a little extra money lying around and decide to invest some of those dollars into paying off that dream home a little earlier than you had expected. "Smack", your mortgage lender slams you with a pre-payment penalty that you didn't know was there. So much for that great deal you thought you had. Always look before you leap. Make sure that you read all of the details, terms, and conditions before you sign your refinance paperwork so you can avoid nasty little surprises later.

More tips will follow this week so be sure to add us to your favorites list!

Setting Up For Refinancing Success

2005-01-16T09:54:00.000-08:00

So you're ready to refinance? You race over to the bank and complete a pile of paperwork that is taller than your home itself only to find that there was a demon lurking deep within your credit report that has put the process on hold. Did you know that 3 out of every 4 credit reports contain an error of some kind? You can avoid the many costs, hassles, and delays that an error on your credit report can cause by simply obtaining a copy prior beginning the refinancing process. One important tip to remember is that their are three major credit reporting agencies in the United States and each of them can carry different information. Be sure to get a copy of your credit report from each one. Here is a good place to start:

FIND OUT what's in your CREDIT REPORT TODAY - so it's 100% ACCURATE TOMORROW. Order a 3-BUREAU REPORT from CreditReporting.com.

Remember that when you are applying to refinance your home mortgage, you are the one who ends up paying the fee for the lender to check your credit so be sure to see your credit report before the bank does! This will allow you to correct any errors ahead of time so that your refinancing goes as smoothly as possible.

Refinancing - Points or No Points?

2005-01-15T13:46:00.000-08:00

One important factor to consider when examining refinancing options is points. A point is typically 1% of the mortgage loan amount. Higher points usually result in a lower interest rate over the entire loan term while lower or no point options result in lower up front costs with higher rates over the term of the mortgage loan. As a general rule: If you are planning to stay in your home for several more years, it may be worth while to pay a few points and benefit from a lower monthly payment over the balance of your loan term.

Refinancing Your Home Mortgage

2005-01-14T13:18:00.000-08:00

So when exactly is it time to look into refinancing your home mortgage? The average American refinances their home about once every four years. If you have owned your home for at least two years, it is probably a good idea to look at refinance options to see if you could be saving valuable dollars. The internet has proven to be the great equalizer for the consumer in this business and allows you to shop multiple refinance lenders for the best possible rate. Here are the top reasons to consider mortgage refinancing:

1. Lower your monthly payments

2. Reduce the amount of time required to pay off your loan

3. Obtain cash for improvements or upgrades

4. Use equity to apply towards a second home or investment property

Many popular websites allow you to request competitive bids from various lenders at your convenience and with no further obligation. Here is a good place to start your search:

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