You’ve probably heard of quicken loans, they’re one of the nation’s largest mortgage lenders and have been marketing a feature they call “Rate Drop Advantage.” This slight variation on the no fee refinance offers out there that covers your closing costs if you agree to refinance with Quicken Loans every seven years. Why you would commit to refinancing within a certain timeframe is beyond me; when it comes to closing costs you always have the choice of paying now or paying much more later. Here’s an article about Quicken Loan’s Rate Drop Advantage Program from the TruthAboutMortgage.com.
In short, the program will pay most of your closing costs if you take out a purchase money mortgage or refinance loan with Quicken and then refinance with them again within seven years.
It seems to me that Quicken loans is gambling that mortgage rates will be much higher in the future, a safe bet considering the Mortgage Banker Association is predicting interest rates will be over six percent soon. Considering that the best refinance rates offered are less than five percent you can almost guarantee a significantly higher payment after refinancing when the program requires.
When you refinance when the program requires you’ll be out-of-pocket for all those same expenses plus you’re giving up the historically low mortgage rates you could be locking in today. It seems to me that Quicken Loans is simply taking advantage of shortsighted homeowners with their deceptively named Rate Drop Advantage program.
You can learn more about getting the best refinance rates for your next home loan while avoiding predatory lenders and junk fees by checking out my free Underground Mortgage Refinancing Videos.
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You can learn more about paying less for your next home loan by checking out my free Underground Mortgage Videos.
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