Home Mortgage Refinancing Guide

Shopping around for a home loan will help you to get the best financing deal. Any mortgage, whether its a home purchase, a refinancing, or a home equity loan, is a product, just like a car, so the price and terms may be negotiable. You’ll want to compare all the costs involved in obtaining a mortgage. Shopping, comparing, and negotiating may save you thousands of dollars.

Obtain information from as many lenders as possible. Home loans are available from several types of lenders: thrift institutions, commercial banks, mortgage companies, and credit unions. Different lenders may quote you different prices, so you should contact as many as possible to make sure youre getting the best price. You can also get a home loan through a mortgage broker. Brokers arrange transactions rather than lending money directly; in other words, they find a mortgage lender for you. A broker’s access to several mortgage lenders can mean a wider selection of loan products and terms from which you can choose. Brokers will generally contact several lenders regarding your application, but they are not obligated to find the best deal for you unless they have contracted with you to act as your agent. Consequently, you should consider contacting more than one mortgage broker, just as you should with banks or thrift institutions.

There’s no harm in asking mortgage lenders or brokers if they can give better terms than the original ones they quoted or than those you have found elsewhere. Once you are satisfied with the terms you have negotiated, you may want to obtain a written lock-in from the mortgage lender or broker. The lock-in should include the rate that you have agreed upon, the period the lock-in lasts, and the number of points to be paid. A fee may be charged for locking in the mortgage rate. This fee may be refundable at closing. Lock-ins can protect you from rate increases while your loan is being processed; if rates fall, however, you could end up with a less favorable rate. Should that happen, try to negotiate a compromise with the mortgage lender or broker.

Use the Internet to get mortgage lenders to compete for your business. There are several sites on the web you can use to do this. Be careful using sites that ask for your Social Security Number. Make sure the sites use Secure Socket Layer (SSL) when entering your information. Many only ask for your contact information and doe not require a Social Security Number.

You should fill out the contact forms located on each of these sites to receive as much information and as many offers for your mortgage as possible. To read more about shopping around sign up for our free guide using the link below.

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