Are you searching for the best mortgage companies offering today’s lowest refinance rates but want to avoid paying unnecessary fees? Did you know that closing costs are up 35% from a year ago primarily due to lender junk fees? One of the most common mortgage mistakes is overpaying the loan origination fee when refinancing which can amount to losing thousands of dollars. Here are several tips before you refi to help you find the best mortgage companies without paying lender junk fees at closing, saving you thousands of dollars at closing.
Who Are The Best Mortgage Companies Online
How do you find the best mortgage companies when refinancing? Should you go with one of the Internet giants like Amerisave, USAA Mortgage Rates, Wells Fargo Refinance, or can a local mortgage broker help find you the best deal? Most of your neighbors approach mortgage refinancing with the recommendation of a friend or by collecting Good Faith Estimates (GFE) trying to compare fees.
The problem with the Good Faith Estimate approach is that the law offers no standards for lenders to follow when preparing loan documents; quoting fees on the GFE is little more than a marketing tool used by lenders to make their offers seem more attractive. Because of this lack of standards fee shopping using the GFE does not give you an apples-to-apples comparison making it nearly impossible to find the best deal.
How to Get The Lowest Refinance Mortgage Rates
Mortgage brokers can be a valuable resource for finding the lowest refinance rates while avoiding unnecessary fees, if you find the right person to arrange your refi. Many of your neighbors try and cut out the middleman by signing with a company like Amerisave Mortgage; however, this doesn’t give you the benefit of the broker’s experience for comparison shopping rates or fees. Mortgage refinancing with a good broker allows you to compare loan offers using this person’s experience. Finding an honest mortgage broker is also the easiest way to avoid paying unnecessary lender fees at closing.
How to Find an Honest Mortgage Broker
Hiring a mortgage broker is like hiring any other professional to work on your home. The recommendations of friends can be helpful but there are other factors you’ll want to consider. One of the most important considerations to make when mortgage refinancing are the closing costs you’ll pay. Whether or not you’re getting a good deal on your refi depends not just on getting the lowest refinance rates but how much you’re paying to get them. If you’re not able to break even recouping your out-of-pocket expenses from closing you’re losing money no matter how low your interest rate.
Getting back to finding an honest broker the easiest way to choose the right person is by their experience level and the fees they charge. Try to find a broker with at least ten years’ experience and make sure they have the appropriate licenses to originate home loans in your State.
Once you’ve verified that your broker is licensed and checked for complaints you’ll want to look at the mortgage loan origination fee. A reasonable amount to pay for loan origination is one percent of your home loan; many brokers try and inflate this fee by charging double, even more. Keep an eye out for unnecessary broker fees including third-party processing and broker courier fees. A sure sign that you’re dealing with a dishonest broker is quoting you a rate lock fee. Lenders don’t charge fees to lock your mortgage rate so any broker that quotes you one is padding their commission at your expense.
I’ve also created a list of Mortgage Licensing Regulators by State.
Despite a few bad apples overcharging their clients I truly believe that finding an honest broker to arrange your next refi is the best approach to refinancing with today’s best mortgage companies without paying unnecessary fees or markup.
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You can learn more about refinancing with today’s best mortgage companies without paying junk fees by checking out my free Underground Mortgage Videos.
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