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Expert Home Loan Refinance Advice

In the market for a home loan refinance and want the lowest mortgage rates without paying junk fees? That’s what everyone wants for their home loan refinance but you have to be some kind of personal finance guru to actually pull it off, right? The truth is getting the best home loan refinance while avoiding junk fees and markup is easier than you think, once you find the right person to arrange your next mortgage. Here are several of my best home loan refinance tips that can literally save you thousands of dollars.

Home Loan Refinance Pitfalls

Did you know that according to the Secretary of Housing and Urban Development homeowners in the United States, (your neighbors) will overpay sixteen billion dollars for their mortgages this year alone? It’s true, most of your neighbors approach their home loan refinance like they’re buying kitchen appliances. This strategy of comparison shopping unit you’re blue in the face results in overpaying every time. Why do you thing that is? Can’t you just sit down with a dozen or so home loan refinance Good Faith Estimates and pick the lowest one?

The problem with the loan refinance offers your neighbors are comparing is that they all include a type of hidden markup intended to create a commission for the person arranging the mortgage. This hidden markup generates a fee for the Mortgage Company or broker known as Yield Spread Premium. You say that you’ve never heard of Yield Spread Premium? Don’t feel bad, neither have most of your neighbors and that’s why many of them are throwing away hundreds of dollars unnecessarily every month.

Get a Wholesale Mortgage Rate

Once you understand how Yield Spread Premium works you’ll know how to avoid it on your next home loan refinance. Mortgage rates that don’t create Yield Spread Premium are called “Par Mortgage Rates” by industry insiders. For you and me these home loan refinance rates are simply known as wholesale mortgage rates. Before we talk about how you can get a wholesale mortgage rate for your next home loan refinance you need to understand how Yield Spread Premium works.

Mortgage Yield Spread Premium is a fairly simple concept to wrap your head around. Home loans are typically arranged by “middlemen” acting as mortgage brokers. It doesn’t matter if you’re dealing with a local broker or one of those big web giants like lending tree this unwanted markup works pretty much the same. (With a few exceptions, but that’s a topic for another time.) Basically Yield Spread Premium is a commission (think fat cat kickback) paid to your broker for locking and closing your home loan refinance with a higher than necessary mortgage rate. For every quarter point (.25%) that you would unknowingly agree to overpay the broker (fat cat slime bucket) collects a fee (again, think kickback) for overcharging you. You can see Yield Spread Premium is little more than an incentive for brokers to overcharge their customers (your neighbors).

How to Avoid Yield Spread Premium

The good news today is that you can avoid Yield Spread Premium on your next home loan refinance and walk away with a wholesale mortgage rate. Avoiding this unwanted markup of your interest rate can lower your payments by as much as $100 a month, even more depending on how much your home loan is. You don’t even have to be that finance guru we were talking about earlier; you just have to find the right person to arrange your home loan refinance. There are honest mortgage brokers out there willing to work for a flat origination fee of one percent without collecting Yield Spread Premium on your home loan.

You can learn more about finding the right person to arrange your next home loan refinance and getting a wholesale mortgage rate by checking out my Underground Mortgage Refinancing Videos.

Here’s a quick sample of what you’ll get with your free membership. This video exposes your lender’s dirty little secret that’s costing your neighbors more cash then they’d care to know…

{ 1 comment… add one }
  • chona malinao September 21, 2010, 7:26 pm

    I agree! this can be helpful to avoid certain mark up! this can be helpful to find right person who will arrange your next home loan.

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