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Quick Steps In order to Refinance Your Home loan

A financial decision including mortgage refinancing is a difficult talk and for a good reason. Your home is the single, greatest, and most important expense you can have in your lifetime. Dropping it with a misjudged or perhaps unintelligent move would mean you need to start all over again. Hence, if you are considering such financial move, there is no far better way to begin than by starting at the right foot.

Step 1: Questions people you know

The first thing you should remember when refinancing the mortgage is to choose a \”reputable company.\” The prevailing rate might be low, but if you land on a organization that thinks really profit than their own client, then it will be useless. A good way to begin searching for a company is via your friends, family or neighbors, or co-workers. Inquire further about their mortgage lender. Furnished with a list, start phoning companies one by one. Neighborhood ones are more acquainted with local market to allow them to be a good source of accurate estimates.

Step 2: Go online

Do not drop online source. Commence searching for companies on the internet and compare. See if you can get competitive rates. Typically, online companies operate nationwide and have offices in major cities.

Step 3: Know the cost

The reason why you re-finance your mortgage is simply to get lower rates, save on monthly payment and also save on total cost of mortgage. However, buying out your existing loan to acquire a new one can be costly and also recouping the cost of re-financing cannot be felt quickly. You must, therefore evaluate the cost of your new loan and also compare it using the savings you’ll get every month. There, you’ll know any time will be your \”break-even point.Inch Know how much you’ll have to spend on fees and points. Ask the lender about the interest. Make all calls as well as know everything you need to understand.

Step 4: Pay attention to particulars

Choose from the list regarding possible lenders you’ve. Know if the company truly has the expertise in the. Can the consultant answer your questions well? Does the company give you the support you need? Does it make ways to get you the terms you need? Can it make return contact immediately? The golden rule when looking for a company is: if you are not secure, move on and look someplace else. Take note, there are hundreds of companies that are willing to supply you with the loan you need so do not necessarily settle for just one. Look at the Better Business Bureau for information regarding your lender.

Stage 5: Bargain

It is your loan. Therefore no matter what happens you are the only person who will cover it and you are alone who will suffer in the event you failed to get the best phrase that is designed for your requirements. Do not be afraid to negotiate. If the prevailing rates are low, negotiate more. Fees will come through everywhere and it will set you back a hefty value if you don’t negotiate in order to trim it straight down. Then, lock the deal so that the mortgage expense will not rise once the loan is being processed. Absolutely no lender is perfect, yet at least pick the best you may get.

Doing your research, shopping around, following your instincts as well as being wise will get you through the entire process efficiently.

Comments: 38

  1. Benedict March 1, 2013 at 9:46 am Reply

    5 years ago my husband at that time (now ex) refinanced on our marital home.
    Deed in his name and I signed the mortgage refinance indicationg I was the wife as per NJ Community Property but not the Note. I still live in home with our children but hasn’t sold for 3 years.
    Ex now wants to have a short sale. What are the tax ramifications and will I be required to pay taxes or will my ex?

  2. Adeline March 10, 2013 at 6:41 pm Reply

    We can knock a full point off our mortgage rate and reduce our term from 30 years to 15 years and add only $300 per month on our payment. We can afford it the extra payment….is there any reason for us not to do it? They’re even knocking off closing fees. What other considerations should we make? What other fees will there be?

  3. Harris March 24, 2013 at 5:06 am Reply

    loan modification, mortgage refinance, home mortgage refinance

  4. Tracey March 25, 2013 at 11:03 pm Reply

    I just want to find out basic info about getting a mortgage, refinancing, home loans, fannie Mae, etc? Is there a place like a mortgageguidance.info ? website or something? FHA? South Bay?

  5. Nieves March 28, 2013 at 4:46 pm Reply

    If interest rates were to drop significantly more, say 30 YR fixed to sub 3%, and a huge percentage of homeowner mortgages are refinanced, what implications does this have on the broader economy, e.g. money supply, inflation, etc?

  6. Denny April 1, 2013 at 9:31 pm Reply

    I am working with my original lender to refinance my house, but I’m curious as to what advantages I have of looking somewhere else. Can the rates be lower from one lender to another or does the market pretty much make it the same for all?

  7. Luis June 3, 2013 at 3:12 am Reply

    Where can I find the lowest interest rate for a mortgage refinance in Arizona? I would like to be able to look for it online.

  8. Rick September 22, 2013 at 4:33 am Reply

    Okay, I have been divorced for about 2 years now. In the seperation agreement, my ex agreed to sell our house ( that both our names are under the mortgage ) or refinance it within 3 years. With only a year left, I have a sinking feeling that he will not sell/refinance in time. What should I do if this happens? Since he signed court paperwork agreeing to sell/refinance within 3 years, do I need a lawyer? Attorney? Any help would be appreciated, thanks!

  9. Sophie September 27, 2013 at 5:15 pm Reply

    Can he help revive the housing market? How does the Fed implement monetary policy to manage the economy? Did the REFI (Mortgage Refinancing) Boom help the economic recovery?

  10. Shawnta September 29, 2013 at 7:20 pm Reply

    I have a high credit score (760), and was approved for my bank’s best rate. The refinancing process is taking awhile, and I would like to get a better rewards card than what I have. Would it be a bad idea to apply for a new credit card before the refinancing closes?

  11. Keith October 19, 2013 at 9:12 pm Reply

    I am working with my original lender to refinance my house, but I’m curious as to what advantages I have of looking somewhere else. Can the rates be lower from one lender to another or does the market pretty much make it the same for all?

  12. Evie November 19, 2013 at 5:23 pm Reply

    I have a mortgage that I am refinancing with another lender (and getting some cash out of the refinancing).

    $3600 is currently held in the escrow account for the existing mortgage with the existing lender. Property taxes are due in a few months. The settlement statement for the new mortgage, which will pay off the old loan, shows that I owe around $3600 for accrued property taxes, and so that $3600 will be deducted from the loan proceeds (not transferred from the old escrow account).

    So when the refinancing occurs, there will be $3600 in the old escrow account, plus a new payment of $3600 for a new escrow account, resulting in $7200 to pay property taxes. I’ll be shorted by $3600.

    The payoff statement from the existing lender states that “amounts held in escrow will be disbursed in accordance with federal law”. So I assume that I’ll have the $3600 sent to me from the existing lender.

    Is that the case? Will I get a $3600 check soon from the old lender? What federal law governs this? (I’d like to check it.)

    Thank you!

  13. Normand December 23, 2013 at 2:25 am Reply

    I see there is a new program coming out for people that are upside down in their mortgages to refinance.
    It looks like it is only for people that have FHA or FMA loans. Is it possible to refinance a home from Conventional to a FHA loan? Even if I owe more than the home is worth at today’s values.
    So there is no way I can refinance an underwater loan to a cheaper interest rate?

  14. Willard December 23, 2013 at 5:02 am Reply

    Current rate of ARM interest is 5.125%. Would it better to go for 6.75% mortgage refinance at no closing costs, if I am planning to live in the same house for next 7 to 10 years?

  15. Hal December 23, 2013 at 5:03 am Reply

    current house payment is 650. What’s better financially, paying an extra 500 per month on our 30 year mortgage or refinancing to a 10 year mortgage and paying 1150 per month? We are 3 years into our 30 year mortgage.
    the 30 year has 5.75%… and i used current rates for the 10 year.

  16. Leonida February 2, 2014 at 3:08 am Reply

    Hello all,
    i ‘d like to know how to best use mortgage refinance, and usually for what reasons people refinance. Also does refinance ultimately cost more? I don’t need to lower my monthly payment, so I don’t have any clear purpose in mind. It is just that I have heard a lot of different views on refinance. I hope to get some insights and analysis from you out there. Thank you.

  17. Vern February 11, 2014 at 1:55 pm Reply

    if you are going to refinance to a lower interest rate. how much lower should the rate be for it to be worth your while.currently 6.5

  18. Devin February 20, 2014 at 10:36 pm Reply

    When you refinance your home with another mortgage company then the one you have know, who lets them know you’ve gone with another mortgage company? Are there penelties? We are in a sliding rate and are trying to get into a fixed rate. thanks!

  19. Willard February 20, 2014 at 10:36 pm Reply

    I was in an accident and got behind on my mortgage. I was able to get countrywide to refinance my mortgage and roll my past due amount back into the note. A month after I refinanced I found out that my note was sold to bank of america. My new mortgage payment was suppose to take affect in May. BOA is not recognizing my refinance. They say that it may take up to 3 more months for them to approve the refinance. Now I’m worried that they are going to foreclose on my house. They are taking my payments but not cashing the checks. Is this legal for BOA not to recognize my refinance?

  20. Dyan February 21, 2014 at 9:41 am Reply

    John and Jane each own 50% of a piece of property. That property has a mortgage. About 10 years go by and John is now taking all the responsibility for taking care of the property; other than being listed on the deed, Jane is not involved at all. John refinances the mortgage without Jane’s participation. Is Jane liable for that new mortgage? Or is Jane’s financial responsibility basically paid off when the first mortgage was paid off by the refinance? Or could Jane have been put on the new mortgage without her knowledge or consent?

  21. Pearle February 21, 2014 at 5:08 pm Reply

    Since the deed is in my name but the mortgage is still in the Sellers name, how do I refinance it

  22. Ping February 21, 2014 at 5:09 pm Reply

    I bought a house with a friend of mine as co-borrower two years ago. I got married recently and want to take over the house and the mortgage. The house has two mortgages when it was purchased at 100% financing at that time. Rates are good. I called up the lending bank who holds both mortgages and they said I can assume the first mortgage but the second mortgage is not assumable. I have to refinance for the second mortgage.

    Another option would be to refinance altogether and combine the two mortgages into one under my name. But since the house was purchased almost two years ago, there has not been that much equity so in order to refinance I have to put down a lot of money. The bank can only finance 95%LTV.

    If I go with refinancing with the second mortgage, the bank will need 85%LTV maximum.

    Not sure what to do. What do you think?
    Thanks Christopher B.! But what is the Power of Attorney for?
    The first mortgage is a 30 year fixed, with 6.5% interest. The second mortgage is a 30 year fixed with 7.9% interest.
    My buddy got married too and intends to buy a house in a year or so. Hence the need to take him off the mortgage.

  23. Fonda February 21, 2014 at 9:59 pm Reply

    Why if banks have given a second chance to clean up their act and help us on their way, are not even attempting to do so.
    talking about mortgage refinance / adjustment.
    worked twice with my bank CHASE, submitting all required documents several times, because did not wanted to lose my house, could not afford the monthly payment of $1364, only $800 specially after losing my job, but the bank refused this, sadly at the end lost my house as thousands of other American hard working people.
    My question here is:
    Why this so called: Mortgage refinance / adjustment is not government regulated?
    Banks are NOT working with people trying to save their homes!
    to loanmasterone:
    Agree with you on the part that banks that were in trouble should have been allowed to fail as all the rest (well us people that is) It was and still is ridiculous to see how CEO’s get salary bonus, raise and other benefits, for what? Oh yes, forgot, for getting the president bailing them out with our tax money.
    Now, do not agree with your point of “the shoe on the other foot” is NOT like we, honest, hardworking people, trying to save our home and stay above water are taking advantage of anything. Simply trying to work things out with the bank so:
    – we could save our home
    – still pay all interest and mortgage (reduced that is) naturally length of time will increase.
    – save the bank money! Because once the house is gone into foreclosure, property’ s value decrease, especially if the family remains living there and the house is not well kept.
    – If the house is empty and is winter time, well start counting the damages there.

    The point here is, banks got bailed out! how

  24. Ingrid February 21, 2014 at 10:38 pm Reply

    I need to know if this a good time to refinance an existing home mortgage. I purchased a home in san antonio in may 2009 at 6%. What are the best banks who would offer me low refinancing rates?

  25. Micah February 21, 2014 at 11:55 pm Reply

    Is there anyone who would know about this?.. and what do I need to do about acquiring this refinancing? any help would be appreciated
    First of all Ms Angie.. I am paying the taxes the lien was issued because I had sub par reprensentation.. when I was trying to the taxes PAID… so before you judge and shoot off at the mouth.., ask a few more questions

  26. Leonardo February 22, 2014 at 5:50 am Reply

    I’ve heard from a friend that Obama came up with a new plan, anyone know what that is or about? Whats the right way to go to lower my payments without having to refinance? Thanks

  27. Coy March 7, 2014 at 4:59 pm Reply

    Hi All,
    I have a 5 yrs term mortgage that I got 2 years ago for a 4-plex I purchased. Last month I contacted an appraiser who appraised the property. Based on the appraisal the property is worth around 100K more than purchased. This means I can apply for refinancing and potentially take out some equity from the house.

    The mortgage is with excellent conditions – good interest. I got it through a mortgage broker with a big bank in Canada.
    I have 2 options for the purpose of refinancing: either contact the bank who provided the mortgage directly OR apply through a mortgage broker who can decide to work with different banks.
    The problem with going with a mortgage broker is that he already told me the new conditions will be worse than current conditions I have. If the current bank approved my refinancing application it would be with the same or better conditions! On the other hand, if I go with the current bank am I not taking a RISK THAT IF THEY DO NOT AGREE to refinance the property because I do not meet their criterias (I am self employed now), then they will also NOT automatically renew my mortgage in 3 years when term is over!? Note: if I do not contact them now, then my understanding is that the bank will automatically renew my mortgage since that is the law in Canada: as long as you pay all your mortgage payments on time, the mortgage is renewed automatically without the need to re-apply/go through the application process again!
    I’m just not sure if I contact them now for refinancing and fail, that they will not keep record of my new ‘bad’ information (i.e. self employed, less stable, etc. whatever caused them not to approve me) and NOT automatically renew my mortgage when the term is over!



  28. Jinny March 10, 2014 at 3:50 pm Reply

    need approval without government

  29. Donella March 10, 2014 at 3:51 pm Reply

    my spouse is in process of refinancing on home. My credit score is slightly below to receive a certain rate. If he still does refinance and when my credit score goes up slightly can I be added to new mortgage? Can this be acheived without changing the percentage rate he locked in at?

  30. Kasha March 10, 2014 at 3:54 pm Reply

    I lost my job and was out of work for seven months. I got behind on my mortage payments and am on a pay plan at the bank.
    Will they let me refinance? I only owned the home for about two years?
    What is reconfirming your loan mean? Please help!

  31. Ai March 10, 2014 at 3:55 pm Reply

    I come to you in search of an answer as my banker seems is being very vague and untimely in getting me answer to my questions. My wife and I recently locked in our 30 year mortgage rate of 6.025%. With the rates dropping lower and lower we asked our banker if we could refinance at a lower rate (near 5%). She basically told us it would cost us more in the long run. I can’t figure out how she came to that. Assuming that rate deduction knocks off, say $120, a month (normally we pay about $1,625/mth); how would we end up paying more over 30 years? This is assuming we’ll still be paying about $1,600/mth that we budget for? Let me know guys…my bank recently pulled their ‘mortgage rate tracker’ from their site; which is adding to an already huge complaint list about my lender.
    -We built a new house and were under the ‘construction window’ until this past June when we locked into our 6.025% rate.
    -We’ve been living their for less than 2 years.
    -The banker spoke to my wife today (I’ll add as much as she remembers:
    -We are in a new credit ‘bracket’ with the bank…something they just started to do, apparently in the past couple months. She said the bank added these brackets after some mortgagees(sp?) could not complete payments…they’re stricter on their loans (we’ve been making payments on-time, plus extra to the principle).
    -She said the banker told her we have a different loan to house value (?) than we did when we transfered over from construction.
    -Right now (banker said) they’re only going as low as 6.3%, but she estimates with Obama’s new plan, if invoked, would drop the rate in our ‘bracket’ enormously.
    -We plan on retiring and living in the house the rest of our lives(60+ years)
    -Any suggestions on where to go?

  32. Doreatha March 10, 2014 at 8:13 pm Reply

    Is there a cut off point dollar wise as to refinancing a mortgage? I”m currently around $64K with approximately 19 years left. Would like to refi to a lower rate on a 20 year term.

  33. Towanda March 11, 2014 at 1:57 am Reply

    I’m two years into a 5 year ARM with an interest rate of 4.375%. I’m worried that interest rates will just keep climbing and that I’ll suffer for it in the long run if I don’t refinance. I do have a 2% cap per year after the fifth year. The rate could get to above 11% total if I don’t refinance. However, I just cringe at the thought of refinancing at a HIGHER rate, even though it may be better in the long run.
    Just to clarify, the ARM is fixed for 5 years (but can go up 2% a year after that) and I’m considering refinancing into a 30-year fixed loan, even though the rate will be higher.

  34. Wilson April 11, 2014 at 12:35 am Reply

    home loan modification vs mortgage refinancing, are they the same thing?

  35. Terrence April 11, 2014 at 1:10 am Reply

    I have to opportunity to refinance my mortgage and cut my interest rate by 2% (7.5% to 5.5%), which will save me $350 a month. We have $265K left on a $271K loan. When all the closing costs ($3,900), insurance and escrow are rolled in, the cost comes to $281K. Are we making out on the deal or is this a bad decision? Side note: We are unsure of how long we will be living in the house. At LEAST the next 2-3 years.
    Additional Notes: The escrow payment is to replenish what is in there with the new escrow company. Lender says I will be receiving a check from my current escrow with essentially the same amount.

  36. Jame April 11, 2014 at 3:25 am Reply

    Would it be worth refinancing a home loan to get a lower rate? We could decrease the rate from 6.5 to 5.5 but it would add $12,000 to my current loan amount. It would remain a 30 year fixed. We’d also get to skip two months of payments (which is actually added into the loan, not really “skipped”); but it’s still money in hand. The current mortgage is less than a year old. Would the refinance be worth it?
    I forgot to say, there are no prepayment penalties. And the added money to the mortgage will make the mortgage more than the house is currently worth (though that may change eventually…hope I hope).

  37. Donella May 28, 2014 at 4:13 pm Reply

    Is there anyone out there that knows about refinanacing a second mortgage? Being a first time homebuyer we were duped into taking out a 13.5% second mortgage on our home. I cant find any info on refinancing this type of loan besides companies who cant be trusted. Any info would help.
    to the smarty pants who wants to make comments about what i can can’t afford. you dont know what I can or can’t afford. the reality it my husband and i prob make more than the two of you combined! But it doesnt matter how much money you make if your credit score is low because we pay mostly with cash! And the way the loan was explained to us was NOT the way it turned out to be.

  38. Jillian May 28, 2014 at 4:14 pm Reply

    I came across this question and have little idea has to how to structure it to solve the answers. Any help and comment will be greatly appreciated. Thank you 🙂

    Imagine you took out a mortgage in year 2000. The mortgage was for $600,000 (this is what they call a jumbo loan) at a 6% (fixed) interest rate for a 30 year loan. As you are no doubt aware, interest rates have fallen across the board and so have mortgage rates. Imagine this rate came down to 5% in 2010. Now, as always, we need to lay out an objective in answering the question. Let us stipulate that the objective of the individual is to minimize the sum total of interest payments. Answer the three questions below showing your calculations.
    1. Does it make sense for the individual to refinance (exactly 10 years after the initial mortgage was taken out)?

    2. What is the break-even interest rate? That is, at what interest rate would this individual be indifferent between refinancing and not refinancing?

    3. What other considerations might individuals take into account in the real world (other than minimizing interest payments)?

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