While refinancing a mortgage can be a great move for many people, it is also not the right thing for everyone to do. If you are lured into a refinancing deal by a slick salesman, or you are unprepared, it can cost you thousands of dollars, or possibly your home. Here are some of the dangers of improperly refinancing a mortgage.

Many times, a homeowner is lured into a refinancing deal with the promise of low interest rates and a better financial future. Many less then honest mortgage lenders and even banks exist that are more than happy to promise you the world, charge you a large fee and do no work in finding you a proper mortgage refinance deal. Even worse, maybe they present you a deal that only increases their commission and will actually damage your financial future or have no true benefits for you. While most all mortgage lenders or banks are honest, reputable, and truly dedicated to helping you, you can bet on some less that upstanding companies that prey on homeowners.

Never lie or stretch the truth on your mortgage refinancing application. Even if you slip the many verification processes, it can and most likely will catch up with you in the long run. If something goes wrong and you cannot prove your finances, the mortgage lender or bank will know that you lied to them. This will hurt your reputation with them and almost kill any chance you have on working with them again on decent terms. Do not take the risk or put yourself to get into a bad situation in the future. Never lie, tell the truth and be transparent with your finances.

Something else important to remember is that unless you are clear about what you expect to get from a mortgage refinancing you can get into the wrong home loan or refinance option. For instance, if your desire is to lower monthly payments you need to be clear on how you intend to lower them. A refinancing can extend your home loan length which lowers payments, get you into a better cost reducing interest rate, or a combination of both. Mortgage lenders and banks have no idea about your financial goals or needs. Help them find the proper mortgage refinancing option for your goals and desires.

There are consequences to refinancing a mortgage the wrong way. Do not let your finances or future be ruined. Make sure you understand the process and are clear on what you need to do and are getting into.

-M Petrone

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