If you’re considering mortgage refinancing you might wonder who the top mortgage lenders are for your refi. Should you go with a nationwide giant like Amerisave or can a broker find you a better deal? Here are several tips before you refi to help you find the top mortgage lenders while avoiding junk fees and unnecessary markup.
How to Shop for the Top Mortgage Lenders
Most of your neighbors approach shopping for the top mortgage lenders using the Annual Percentage Rate (APR) and Good Faith Estimate (GFE) from as many lenders as they can contact. The problem with this approach to shopping for refinance mortgage rates is that there is no standard for how lenders calculate the APR they give you when quoting home loan offers. APR is loosely based on the charges found on your Good Faith Estimate which is little more than a marketing tool used by lenders to promote overpriced home loans.
If you can’t rely on your loan documents to find the top mortgage lenders how can you reliably shop for today’s lowest refinance mortgage rates without paying junk fees? Instead of comparing apples to oranges like your neighbors did it makes more sense to shop for the right person to arrange your next home loan with the top mortgage lenders. Find the right broker can get you access to day’s best refinance mortgage rates without paying unnecessary fees.
Closing Costs Make or Break Your Refi
The reason closing costs are so important when mortgage refinancing is that you’ll have to recoup your out-of-pocket fees before benefiting from your lower mortgage refinance rates. Overpaying when closing on your new home loan can cut or even negate any benefit you’re getting from refinancing. The more you pay at closing including those pesky junk fees the longer it’s going to take to break even recouping your fees. Everyone knows mortgage rates are near historic lows; however, most homeowners don’t know lenders are trying to make up for lost revenue by jacking up their refinancing fees.
One of the most common mortgage mistakes is focusing only on getting the lowest refinance mortgage rates from the top mortgage lenders at the expense of closing costs. Most people don’t know that there are no “mandatory” closing costs and all the fees on your Good Faith Estimate are negotiable and vary wildly across lenders. If haggling over fees isn’t your cup of tea you can benefit from the experience that comes with a good mortgage broker, just make sure you’re not overpaying the origination fee for their services.
Loan Origination Fee Secrets
Hiring the right mortgage broker is stressful. How do you now if you’re dealing with an honest person? Start by examining the fees your broker quotes you. The loan origination fee should not be more than one percent of your home loan amount; however, it’s not uncommon for brokers to quote double this amount. Tell prospective brokers that you’re willing to pay a reasonable amount of one percent for their origination fee. Second, watch out for rate lock fees. This is a sure sign that you’re dealing with a disreputable broker as none of the top mortgage lenders charge a fee for locking in your refinance mortgage rates.
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You can learn more about finding the right person to arrange your next home loan with the top mortgage lenders by checking out my free Underground Mortgage Videos.
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