If you’re considering mortgage refinancing and are shopping for the best refinance rates available, the government wants your opinion on new lender disclosure forms. According to this article on HSH.com, the Consumer Finance Protection Bureau is soliciting help from homeowners to simplify refinance rate quote forms. You can read more about these mortgage refi forms at HSH.com:
The newly-formed Consumer Finance Protection Bureau wants to revise the good faith estimate (GFE) form that lenders use to explain your mortgage terms. It’s asking consumers to choose one of two forms, neither of which is likely to please lenders.
http://blog.hsh.com/index.php/2011/06/government-wants-to-simplify-mortgage-quotes/
The problem with the current Good Faith Estimate (GFE) that you get from prospective lenders is that this form along with the Annual Percentage Rate (APR) is little more than marketing propaganda for most banks. The current disclosure law requires lenders to give you the GFE and APR; however, the law does not specify how that Annual Percentage Rate is calculated or what fees should be included.
Because of this lack of standards it is nearly impossible to make an apple-to-apples comparison of loan offers from different lenders. If you’re shopping for a the best refinance rates in this manner you won’t get a good picture of the fees required to get the advertised interest rate. Fees determine how good of a deal you’re getting on your mortgage refi because you have to recoup your closing cost to realize any benefit from today’s historically low mortgage rates.
You can get more tips before you refi 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.
