Everyone wants to do whatever they can do to save money, especially homeowners in todays economy. Due to the struggling housing market, interest rates have been dramatically reduced to entice homeowners to buy, refinance, or modify their home loans. Here are some helpful tips which will ensure you get the best rate when refinancing your home loan.

This is just a basic set of tips to help get you on the right path to a proper home mortgage refinance. Although these are generally accepted as good and sound refinancing tips, each homeowners financial situation and goals is different. When refinancing a home loan make sure to do the proper research into potential mortgage lenders, banks, and the different programs they offer which will assist you in the renegotiation of your mortgage.

-Be on the look out for mortgage lenders and banks shady and sneaky interest games. A lot of homeowners fall victim to “No Cost”, “Low Cost”, or “0% Interest”. Almost every one of these loans seems to good to be true, and it is. These loans typically start with a small or no down payment, and a very small monthly mortgage amount. However, one day, the interest rate will skyrocket, or a balloon type of payment may be added sometime in the home loans length.

-Choosing a loan option with points or without points. Lowering interest rates is a great way to save a large amount of money every month. However, you need to calculate the benefits of a lower interest rate versus paying interest points upfront. Depending on the decision you make, and how long you actually plan to love in your home.

-Look out for hidden fees or associated costs. Typically, when interest rates seem to good to be true, they are. A lot of times with a super low interest rate comes hidden fees and costs which more than make up for that “low” interest rate.

-Always get a good faith estimate (GFE). A homeowner has a legal right to obtain a GFE or (Good Faith Estimate). A copy of this should be provided upon request. Scour over this document throughly to reveal any problems or issues not discussed with your mortgage lender or bank.

-Do some final math calculations and carefully weigh the benefits of a mortgage refinance with the costs involved, and length of time you plan on spending in the home. Always be sure to include any closing costs or other fees when adding up the final numbers.

These basic tips should help the average homeowner start out on the right foot when refinancing a home mortgage. All situations are different and will have a role when you get your deal. Always make sure to shop around to different lenders and banks to help ensure you are actually getting the best home refinancing deal possible.

-M Petrone

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