If you’re considering a mortgage refi and want the best refinance rates available, Adjustable Rate Mortgages are making a comeback as a popular option for your next home loan. Today’s ARMs are different from the Adjustable Rate Mortgage loans you’ve known in the past. According to this article in the Las Vegas Review-Journal, Adjustable Rate Mortgages are safer, cheaper, and a more attractive option for mortgage refinancing.
Immediately following the mortgage market meltdown, adjustable-rate mortgages were considered toxic relics of a broken system operated by lenders run amok. But today, with greater safeguards in place and a bigger initial rate disparity compared to fixed-rate loans than in the past, ARMs are again appearing as an option for many borrowers.
If you’ve decided to go ahead with your mortgage refi you’ll want to minimize your closing costs to avoid overpaying. Remember that you have to recoup your expenses before you’ll realize any benefit from mortgage refinancing. Avoiding junk fees like rate lock and processing fees are important; however, there is one fee you want to make sure you’re paying out of your own pocket.
I am of course referring to lender paid broker compensation or yield spread premium. If you want the best refinance rates available for your mortgage refi it doesn’t make sense to accept higher interest rates and a higher monthly payment just to avoid paying the broker.
A reasonable amount to pay your broker for mortgage loan origination is one percent of your home loan amount. Don’t let a fast talking broker talk you into letting the lender pay this fee in exchange for a higher payment for the entire duration of your home loan.
You can learn more about unnecessary markup and junk fees on your next mortgage refi by checking out my free Underground Mortgage Refinancing Videos. These refi videos have been viewed by over 300,000 people just like you and save the average homeowner $1200.