If you are planning on refinancing your mortgage loan you need to do your homework to avoid making costly mistakes. Doing your homework and researching mortgage lenders will ensure you do not overpay the finance charges on your new mortgage. Here are tips to help you avoid making these mistakes.
Get Your Finances in Order
One of the biggest mistakes homeowners make before refinancing their mortgage is not staying on top of their finances before applying. Having your mortgage application denied because you haven’t reviewed your credit and organized your paperwork will cost you money. You will need to request copies of your credit reports from the three credit agencies and carefully review these records for errors. If you find errors you need to dispute them with the creditor and the credit agency. If your credit score is not where it should be you will need to improve it before applying for your new mortgage. You can improve your credit score by paying down the balances on your credit cards and making sure all of your payments are made on time.
Neglecting to Shop Around
Mortgage offers are easy to come by; however, if you want the best deal for your loan you need to do some legwork. Comparison shopping for a mortgage means carefully comparing all aspects of the loan including closing costs, not just the interest rate or Annual Percentage Rate. The amazing mortgage deal you think you’ve found could turn out to be a nightmare after you examine the fine print.
You can learn more about avoiding common mortgage mistakes by registering for our free mortgage guidebook: “Five Things You Need to Know Before Refinancing Your Mortgage.”
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.
