Finding the best mortgage brokers for your next refi is a good strategy for saving thousands of dollars; however, unnecessary points and fees can quickly turn any mortgage refinance into a costly mistake. Recent government changes to the rules regulating loan originator compensation make it easier for homeowners to spot unnecessary markup and junk fees; however many homeowner make common mortgage mistakes that still result in overpaying. Here is some of my best advice on refinancing your home to help you avoid costly mortgage mistakes on your next home refinance.
Finding The Best Mortgage Brokers
First of all, should you bother with the best mortgage brokers or can working with your bank help you avoiding refinance fees? If not your bank, how about refinancing with a giant company like Amerisave Mortgage? Banks and large companies make the process fast and convenient; however, they’re not always the cheapest option and in the case of big companies like Wells Fargo Mortgage may not have a reputation for treating their customers (you) well.
The problem with bank refinance rates is that thanks to a loophole in the Real Estate Settlement Procedures Act your bank is not required to show any of their markup or profit margin on your home loan. Banks don’t have to play by the same rules as other lenders because the banking lobby spent millions of dollars changing the rules so the bank doesn’t have to play fair. All the bank is required to give you is an Annual Percentage Rate based on a Good Faith Estimate created by the bank’s marketing department that ultimately isn’t grounded in reality.
Beware Bank Refinance Rates & Fees
Why would you ever considering trusting something as important as your home loan to a lender that doesn’t have to play by the rules? This is why I never recommend banks when it comes to any mortgage refinance.
How can you go about finding the best mortgage brokers? It’s true that the loan originator acts as a intermediary between you and the best mortgage companies; however, the best mortgage brokers have access to refinance rates and loan offers not available to the public. Finding the best mortgage brokers is a sure bet for avoiding unnecessary refinance fees.
Mortgage Settlement Refinancing Fees
Common mortgage mistakes made by many homeowners include neglecting to negotiate settlement fees. Did you know that your closing costs are negotiable? Lenders set their own fees, which is why you see such a range of closing costs on your Good Faith Estimates. Refinancing with the best-rated mortgage companies doesn’t guarantee you’ll avoid unnecessary fees; you really need to find the right person to arrange your next home loan for that.
How do find the best mortgage brokers for your refi? Start by looking for self-employed professional working in your area. Small, self-employed loan originators don’t have the same overhead as large companies and will be much more likely to negotiate the kind of deal you’re looking for with your mortgage refinance. Offer to pay a flat origination fee of one percent and you’ll be on your way to refinancing without unnecessary points or fees.
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