Average closing costs for a mortgage refinance loan range between four and five thousand dollars, up around 9% from last year. What many homeowners don’t know about their mortgage refinance is that closing costs vary from one lender to the next and you can negotiate to pay less. You can save yourself quite a bit of cash at closing simply by comparison shopping lender fees and negotiating fees. Here’s an article from the San Francisco Chronicle with tips you can use to pay less when closing on your mortgage refinance loan:
“Interest rates get a lot of attention, and rightfully so, but it’s also important for consumers to compare lender fees when shopping for a loan,” said Greg McBride, CFA, senior financial analyst for Bankrate, Inc.
Common mortgage mistakes include not negotiating the loan origination fee. Paying one percent of your home loan amount for arranging the mortgage refi is a perfectly reasonable fee for the broker. Don’t be afraid to make paying less for the loan origination fee a condition of your business.
According to BankRate.com that mortgage loan origination fee can range anywhere from $700 to as much as $4,000 and that doesn’t include your closing costs! Getting today’s best refinance rates in today’s market isn’t difficult; however, most of your neighbors neglect paying attention to fees when mortgage refinancing.
The reason the closing costs and origination fees are so important is that you’ll need to recoup this out-of-pocket expense before gaining any benefit from your mortgage refi. The more you pay at closing and for loan origination the longer it’s going to take to break even and the less benefit you’ll be getting from your new home loan.
You can learn more about paying less for your mortgage refinance by avoiding lender junk fees by checking out my free Underground Mortgage Videos.