With mortgage rates at an all time low, home mortgage refinancing applications are going through the roof. In all of this hype are greedy mortgage lenders who will take advantage of these good times for borrowers, and try to get them for as much money as they can.

Here are some tips on how to avoid being ripped off should you be looking to refinance your home.
If you are interested in refinancing your current mortgage, for what ever reason, and are unsure of where to start or who to talk to you have found a good starting point here. One of the first things you should get together is some financial information that you will have. This includes knowing your current mortgage rates and terms, knowing your credit report now and when your initially purchased your home, current interest rates, and if you have an appraisal that will help but not necessary as the lender will most likely have their own. You are entitled to at least 1 free credit report and should get one to review and fix any inaccuracies that are in it before pursuing a mortgage refinance.
Once you have established the basic information you can start to comparison shop on your own. It is generally a good idea to comparison shop a variety of lenders in a short period of time so that all of the credit checks wont negatively affect your refinancing process. Once you have received a quote with terms and conditions you like, try to get it in writing, then shop that exact quote around to different lenders you have already applied with. See if they will match or better the offer you present them. Most of the time they will allowing you the comfort of choosing a company you feel comfortable with.

If you are looking to refinance in order to get cash back, you will generally be extending the length on your mortgage from say 10 years to 15 to 30 depending on how much cash you require, and how much you owe on the initial mortgage compared to how much the home is worth. If you wish to refinance to get lower monthly payments, you should look for a interest rate 2% or lower than your current one. This will almost ensure your monthly mortgage payment is lower, for the entire course of the loan.

Do not be afraid to ask questions. Do not hesitate to walk away from a lender if you at all feel doubts. There are a lot of reputable lenders who are happy to find a solution perfect for your needs. Do not forget their will be closing costs associated with a mortgage refinance. You generally have the option to add these fees to the loan total but it is better to pay all of them or as much as you can upfront. You do not want to get stuck paying interest on closing costs for 30 years, that is money wasted. Refinancing a mortgage is not an end all solution, use it wisely and have a financial plan before and drastic changes happen.
-M Petrone


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