Refinance Mortgage Facts that Save Time and Money
If you are in the market for a refinance mortgage then take time to read these facts designed to save time and money:
Refinance Mortgage Tips
- Know Your Rights. Ever signed on the dotted line only to find a better deal days later? Sometimes it happens. Fortunately, you have three business days to review the contract and notify the lender in writing should you change your mind. There are ramifications to this action, so be sure you understand the consequences in advance.
- Lock-In Rates. A rate lock is where you pay a fee in exchange for a guaranteed rate at closing as long as the closing takes place within a specified period of time. Many refinance mortgage lenders suggest a 30 day rate lock but that can spell trouble since it typically takes 45 to 60 days for a closing to take place. Should rates increase before closing occurs, you may find yourself stuck with a higher than anticipated interest rate for the life of the loan. Protect yourself by locking in rates for 45 to 60 days instead of the typical 30. You will pay a little more but it might be a great investment for the long term.
- Tally the Total Cost. Don’t judge a refinance mortgage lender by their application fees. Low- to no-cost application fees are often designed to lure unsuspecting consumers into a higher than average interest rate or more expensive closing costs. Instead, tally up the total costs including interest rates, points, closing costs and application fees, then make a final decision as to which is the best package for your refinance.
- Update your Insurance. Make sure your insurance coverage is adequate to cover the full mortgage after refinancing and notify your agent of the new contact information for the underwriter or loan holder. Many homeowners are surprised to learn they are under-insured until disaster strikes and they find the payment amount insufficient to rebuild or pay the mortgage loan in full. Speak to your agent to make sure your coverage is adequate and verify all contact information is accurate in the insurance records.
- Verify Service. Few things are more frustrating than dealing with an unresponsive company. Fortunately, when obtaining online quotes it’s also easier than ever to perform a quick search for testimonials and other customer service related issues. It can make all the difference between good or great service when you want to refinance your mortgage.