Refinancing a home mortgage now is a great way to take advantage of all time low mortgage rates. However, you must be sure to avoid the common mistakes that homeowners make when refinancing. This article will reveal 8of the most typical home mortgage refinance mistakes, and most importantly, how to avoid them.

Common and costly mortgage refinancing mistakes list.
*Not doing enough research on potential lenders
A lot of people are pretty happy with their current mortgage lender. You should realize that when refinancing a mortgage, you have the option to choose any lender you prefer. You should comparison shop a variety of lenders to ensure the best rates, terms, or conditions are offered. Once you get a quote you like with a lender you have researched and comfortable with, shop that exact quote around to other potential lenders. Often, they will match or beat the offer you brought them, especially if it is in paper.

*Know how long it will take after a refinance you will break even.
When you have done the research on potential lenders, hopefully you got an idea about closing costs. There will be closing fees and costs associated to refinancing a home mortgage. Initially, these costs will seem high and not worth the effort. Most of the time though, these costs are negated by the monthly savings of the refinance within a year. Try to pay closing costs up front in full, or at least as much as you can, to avoid paying interest on those fees. See when your break even time will be by calculating the expenses versus the savings monthly and do the math.

*Not receiving a good faith estimate from a potential mortgage lender.
Potential mortgage lenders should always be able to provide, upon your request, a good faith estimate. This estimate will include any closing costs or fees and any other expenses related to the refinance. This should usually be given within 3 days of the estimate but you should be able to get it almost immediately if you ask your lender.

* Do not consider the assessed value of the property
The assessed value of your home and property is given by the local municipality as a taxing measure. Your home loan amount will not be based on this amount though. Your home will be valued by what is known as the cost approach.

*Appraising a home with little value
Sometimes homeowners know that for whatever reason the value of their home is pretty low. Do not pay to have your homes value assessed. Ask your lender if they will use the AVM model to appraise the current value of your home. AVM method uses the value of homes in the neighborhood surrounding your home to get an estimate.

*Throughly read everything prior to signing.
Always properly review anything you are going to sign. Make sure to pay special attention to the terms, rates, and conditions before signing anything. Ask for a copy of the loan prior to the closing in order to have a good chance to give it a good review and write down any questions that you have.

*Provide any necessary documents in a timely manner.
Have all the proper documents and other related materials ready and organized before you submit your mortgage application. This will speed up the process a lot and lock in rates when they are their lowest. Delaying for too long will just increase the chances of higher mortgage rates.

*Get everything in writing
Although there are plenty of trustworthy mortgage lenders, when it comes to this amount of money, a mortgage, get anything quoted to you in writing. Sometimes a lender will talk of super low rates and fees but upon closing will attempt to raise the price, do not let them. Have everything written down prior to closing on a mortgage refinance.

-M Petrone

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