If you’re considering a mortgage refinance for your existing home loan brokers are an excellent resource for getting the lowest rates without paying unnecessary fees… IF you choose the right person to arrange your refi. The problem is choosing the wrong broker can result in overpaying thousands of dollars. Once common mortgage mistake is letting the wrong broker talk you into no fee refinancing. Here’s an example of bad mortgage refinance advice that clearly benefits the broker.
No-cost mortgages were first introduced over two decades ago as a tool for refinancing with little or no cash down that leaves the door open to refinancing again when and if rates go lower. Today, they are once again gaining popularity, but for slightly different reasons.
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The problem with no fee mortgage refinancing is that you’re trading a higher mortgage rate and payment amount for the entire duration of your home loan. This isn’t a car you’re buying…this is a thirty-year mortgage. You’re trading three to five thousand dollars in closing cost for paying as much as a hundred dollars a month, more in some cases. After five short years you’ll have almost paid double what you could have paid up front.
If you want the best refinance rates without paying junk fees mortgage brokers are the way to go; however, instead of shopping for the lowest interest rates it makes more sense to shop around for the right broker to arrange your mortgage refi. Don’t let the wrong person sell you an overpriced home loan.
You can learn more about refinancing your home loan without unnecessary fees or markup by checking out my free Underground Mortgage Refinancing Videos.
My name is Rob Regehr and I’m a personal finance writer with a chip on my shoulder for banks and brokers that take advantage of my friends and neighbors.
