Expert Home Loan Refinance Advice

In the market for a home loan refinance and want the lowest mortgage rates without paying junk fees? That’s what everyone wants for their home loan refinance but you have to be some kind of personal finance guru to actually pull it off, right? The truth is getting the best home loan refinance while avoiding junk fees and markup is easier than you think, once you find the right person to arrange your next mortgage. Here are several of my best home loan refinance tips that can literally save you thousands of dollars.

Home Loan Refinance Pitfalls

Did you know that according to the Secretary of Housing and Urban Development homeowners in the United States, (your neighbors) will overpay sixteen billion dollars for their mortgages this year alone? It’s true, most of your neighbors approach their home loan refinance like they’re buying kitchen appliances. This strategy of comparison shopping unit you’re blue in the face results in overpaying every time. Why do you thing that is? Can’t you just sit down with a dozen or so home loan refinance Good Faith Estimates and pick the lowest one?

The problem with the loan refinance offers your neighbors are comparing is that they all include a type of hidden markup intended to create a commission for the person arranging the mortgage. This hidden markup generates a fee for the Mortgage Company or broker known as Yield Spread Premium. You say that you’ve never heard of Yield Spread Premium? Don’t feel bad, neither have most of your neighbors and that’s why many of them are throwing away hundreds of dollars unnecessarily every month.

Get a Wholesale Mortgage Rate

Once you understand how Yield Spread Premium works you’ll know how to avoid it on your next home loan refinance. Mortgage rates that don’t create Yield Spread Premium are called “Par Mortgage Rates” by industry insiders. For you and me these home loan refinance rates are simply known as wholesale mortgage rates. Before we talk about how you can get a wholesale mortgage rate for your next home loan refinance you need to understand how Yield Spread Premium works.

Mortgage Yield Spread Premium is a fairly simple concept to wrap your head around. Home loans are typically arranged by “middlemen” acting as mortgage brokers. It doesn’t matter if you’re dealing with a local broker or one of those big web giants like lending tree this unwanted markup works pretty much the same. (With a few exceptions, but that’s a topic for another time.) Basically Yield Spread Premium is a commission (think fat cat kickback) paid to your broker for locking and closing your home loan refinance with a higher than necessary mortgage rate. For every quarter point (.25%) that you would unknowingly agree to overpay the broker (fat cat slime bucket) collects a fee (again, think kickback) for overcharging you. You can see Yield Spread Premium is little more than an incentive for brokers to overcharge their customers (your neighbors).

How to Avoid Yield Spread Premium

The good news today is that you can avoid Yield Spread Premium on your next home loan refinance and walk away with a wholesale mortgage rate. Avoiding this unwanted markup of your interest rate can lower your payments by as much as $100 a month, even more depending on how much your home loan is. You don’t even have to be that finance guru we were talking about earlier; you just have to find the right person to arrange your home loan refinance. There are honest mortgage brokers out there willing to work for a flat origination fee of one percent without collecting Yield Spread Premium on your home loan.

You can learn more about finding the right person to arrange your next home loan refinance and getting a wholesale mortgage rate by checking out my Underground Mortgage Refinancing Videos.

httpv://www.youtube.com/watch?v=be9md0A0_2c

Here’s a quick sample of what you’ll get with your free membership. This video exposes your lender’s dirty little secret that’s costing your neighbors more cash then they’d care to know…

Home Loan Refinancing Secrets

If you’re considering home loan refinancing there are several things you’ll want to know to avoid overpaying for your mortgage loan. Did you know that all of the mortgage rate quotes you get online or from your local bank or broker include hidden markup? This is the reason almost all of your neighbors are throwing away thousands of dollars every year for no good reason. Here are several of my best home loan refinancing tips that blow the doors off your lender’s dirty little secret.

Home Loan Refinancing Pitfalls

Most financial gurus categorize home loans as retail products and this is somewhat true; however, you don’t have to accept retail markup of your home loan. With the exception of banks (we’ll talk about the problems with bank originated home loan refinancing in a moment) home loans come from wholesale lenders and are arranged by brokers and mortgage companies that act as retailers. At least this is what they’d like you to believe. The truth is you’re already paying that mortgage company or broker a perfectly reasonable origination fee for arranging your home loan and any markup of your interest rate when home loan refinancing to collect a commission from the lender is not only unnecessary but drives up your monthly payment by as much as $1200 a year.

How does this unnecessary markup of your interest rate work? Loan originators like your mortgage broker collect a fee known as Yield Spread Premium from wholesale lenders for locking and closing your home loan refinancing with a higher than necessary interest rate. This is the mortgage industry’s dirty little secret. Brokers and other loan originators have an incentive for overcharging you and this kickback can be quite expensive. Question your broker about Yield Spread Premium and you’ll find them on the defensive, telling you not to worry about a fee that isn’t coming out of your pocket. What your broker isn’t telling you is why the lender pays them Yield Spread Premium and what it does to your monthly payments.

The Problem That is Yield Spread Premium

The Problem with Yield Spread Premium is what this markup does to your mortgage payment. Here’s an example to illustrate my point. Suppose your home loan refinancing is for $325,000 and the broker quotes you a mortgage rate of 6.0%. You agree to pay a 1.5% loan origination fee which means you’ll pay the broker $4,875 at closing for their work. First of all, don’t get me wrong, the broker deserves to get paid for their work; however, one percent is more than reasonable in this case. In this example the origination fee should not be more than $3,250. Where this example of home loan refinancing gets ugly is what your broker isn’t telling you about the mortgage rate. Your lender actually approved you for a 5.25% interest rate; however, the broker marked it up to six percent to collect a three percent commission from the lender.

That’s right, for every .25% that your mortgage broker overcharges you the lender pays them a kickback of one percent of your home loan refinancing amount. This is the industry’s dirty little secret and what the mortgage fat cats you see tooling around in their company hummers don’t want you to know about. Sure mortgage brokers are required to disclose the fee they receive on your HUD-1 due to the 2010 changes to the Real Estate Settlement Procedures Act; however, they all have clever ways of explaining this fee way.

What about banks you ask? Can’t you avoid all this home loan refinancing nonsense by getting a new mortgage from your bank? While it’s true there is no Yield Spread Premium involved with bank originated home loan refinancing for the simple reason that the bank funds your loan, banks still markup interest rates to boost their profits in a similar manner. Throw in the fact that your bank is exempt from the Real Estate Settlement Procedures Act and not required to tell you about their markup or profit margin on your loan and this more than ample reason to avoid the bank completely when it comes to home loan refinancing.

There is good news since you’ve found this website today. It is possible to pay a flat one percent origination fee for home loan refinancing and walk away from closing with a wholesale mortgage rate. My free Underground Mortgage Videos will show you how to get a wholesale mortgage rate while avoiding all the junk fees your neighbors overlooked with their home loans. Did I mention the videos are free, no strings attached?

You can learn more about wholesale home loan refinancing by checking out my free underground mortgage refinancing videos.

httpv://www.youtube.com/watch?v=be9md0A0_2c

The mortgage videos are quick and easy to follow…here’s a sample to help you get started trimming as much as $1200 worth of fat from your next home loan.

Mortgage Refinancing With Your Bank

Mortgage Refinancing with your bank can be a fast and convenient way of lowering the monthly payments on your home loan; however, is your bank really the best place for avoiding hidden markup and junk fees? Mortgage refinancing can save you thousands of dollars if you find the right person to arrange your next home loan; choosing the wrong person could cost you. Here are several of my best tips for getting the lowest mortgage rate while avoiding paying too much in closing costs and fees.

Is Mortgage Refinancing With Your Bank a Good Idea?

Many of your neighbors choose bank mortgage refinancing because it’s a quick and easy avenue to a new home loan. What could be easier than automatically transferring your mortgage payment from your checking account each month? The problem with bank originated mortgage refinancing is what your banker isn’t telling you and isn’t obligated to tell you. You see, banks are exempt from the Real Estate Settlement Procedures Act that requires loan originator to disclose their profit margin and markup of your interest rate. The banking lobby spent millions of dollars lobbying congress in the early nineties to have this key bit of disclosure legislation changed to exclude banks, thereby giving them an unfair advantage. When it comes to your home why would you even consider working with a lender that doesn’t have to play by the rules?

Bank Service Release Premium

I’m going to take a moment to explain how your bank exploits this loophole in the Real Estate Settlement Procedures Act. Every mortgage lender out there, banks or wholesale lenders alike makes money by selling their loans to investors on the secondary market. The higher the interest rate on these loans, the more profit lenders make from investors. Wholesale mortgage lenders have a disadvantage next to banks because their customers know how much their mortgage rates were marked up to create this profit for the lender. Not everyone understands it, but a savvy homeowner can save thousands by recognizing and avoiding this markup.

Your bank isn’t required to disclose any of this mortgage refinancing markup. They know the home loan rates other lenders are offering their customers; however, they mark the bank mortgage rates up as much as they think their customers will pay to create this extra profit known as Service Release Premium for the bank. Because your bank isn’t required to disclose any of this markup you to you all you’ll get when mortgage refinancing with your bank is an Annual Percentage Rate based on a Good Faith Estimate filled with low-balled fees.

Wholesale Mortgage Refinancing?

It is possible to refinance your home loan with a wholesale mortgage rate and pay only a one percent origination fee in the process. Banks simply do not offer their customers wholesale mortgage rates because they don’t have to; however, find the right mortgage broker and you can get this kind of deal and save yourself as much as $1200 per year from unnecessary markup. Who is the right mortgage broker for mortgage refinancing with a wholesale rate? Look for an independent, self-employed broker. These brokers will be much more willing to negotiate the type of deal that gets you wholesale rates without points or junk fees.

You can learn more about mortgage refinancing with wholesale rates by checking out my Underground Mortgage Videos.

httpv://www.youtube.com/watch?v=be9md0A0_2c

Here’s a quick taste to get you started cutting as much as $1200 worth of fat from your mortgage payments every year.

Refinance FHA Home Loan

Typing Refinance FHA Home Loan into Google might have brought you here today searching for the best way to get a new home loan. Did you know that simply searching for Refinance FHA Home Loan could result in overpaying thousands of dollars for your new mortgage loan? Many homeowners get a false sense of security because they get FHA home loans; however, government backing by the FHA does nothing to protect you from unnecessary markup or junk fees. Here are several tips to help you avoid the trap of simply typing Refinance FHA Home Loan and save thousands of dollars from unnecessary markup and junk fees.

Refinance FHA Home Loan Online

The internet is a great resource for your home loan. Just type Refinance FHA Home Loan into your browser and you’re on your way to finding great loan offers, right? Not exactly…what you might not know about those refinance FHA home loan offers is that they all include markup intended to create a commission for the person arranging the home loan. Nothing wrong with that you’re saying…mortgage brokers deserve to get paid too. The problem is that you’re already paying the person arranging your refinance FHA home loan a perfectly good loan origination fee. Any markup of your interest rate for lender paid compensation is at your expense in the form of a higher than necessary monthly payment.

How does this unnecessary markup of your mortgage rate quote work? Wholesale lenders publish daily rate sheets used by mortgage brokers to quote mortgage rates. These rate sheets include various amounts of markup intended to generate the fee known by mortgage fat cats as Yield Spread Premium. Simply put, brokers who lock and close your refinance FHA home loan with a higher than necessary interest rate get one percent of your loan amount for every .25 percent they overcharge you. Think of this fee as an incentive for overcharging you. Mortgage lenders do this because any refinance FHA home loan with a higher than market interest rate brings them a premium profit when sold to investors on the secondary market…this is how lenders make the majority of their profits.

How to Pay Less for Your Home Mortgage Loan

What your lender doesn’t want you to know is that you can get a wholesale mortgage rate. Wholesale mortgage rates are also known as par mortgage rates; this simply means there is no Yield Spread Premium generated for the broker and you won’t pay discount points to qualify. Most mortgage brokers will tell you that you cannot get wholesale rates because they’re protecting their commission. Truth be told, find the right mortgage broker and you’ll not only get a wholesale refinance FHA home loan but can avoid paying junk fees in the process.

What should you be paying for your refinance FHA home loan? A mortgage origination fee of one percent is more than reasonable for the broker’s work. This is assuming there is no Yield Spread Premium and you’re not finding junk fees on your HUD-1 like the broker courier fee. Here’s a bonus tip, never rely on the Good Faith Estimate to provide reliable lender fees; it is after all just an estimate given in “Good Faith.” When it comes to home loans the final word in lender fees is the HUD-1 statement. Lenders are required to give you one at least 24 hours prior to closing. If you’re not going through this document with a fine-toothed comb you could be losing thousands of dollars in unnecessary fees.

You can learn more about getting a wholesale mortgage rate for your refinance FHA home loan while avoiding junk fees by checking out my free Underground Mortgage Videos.

httpv://www.youtube.com/watch?v=be9md0A0_2c

Here’s a quick video to get you started that exposes your lender’s dirty secret that according to the HUD Secretary will be responsible for fleecing American’s out of sixteen billion dollars this year alone.

Home Loan Refinance Mistakes

Looking for the lowest home loan refinance for your next mortgage but don’t want hidden markup or junk fees? Did you know that most of your neighbors paid too much for their home loan refinance because they didn’t recognize hidden markup of their mortgage rate? Here are my best tips for avoiding overpaying for your home loan refinance and putting cash back into your pocket from your current mortgage payment.

Home Loan Refinance Online

The Internet’s great for any home loan refinance; however, what most homeowners don’t know about the quotes they find online is that they all have hidden markup built in. This markup serves no purpose other than to create an extra commission for the person arranging the mortgage at your expense. This hidden markup means your monthly mortgage payment could be a hundred dollars or more than it needs to be; quickly draining thousands of dollars from your bank account in just a few short years.

How does this hidden markup of your mortgage rate work? Mortgage lenders reward loan originators with a fee known as Yield Spread Premium for locking and closing your home loan refinance with a higher than necessary interest rate. The broker won’t tell you they’re doing this and the fee is often cleverly disguised in your Good Faith Estimate and HUD-1 statement. Even if you find the fee most brokers explain it away by telling you not to worry about it since the fee isn’t coming out of your pocket. The point is not that you’re not paying this fee but what the fee does to your monthly payment…here’s an example to illustrate my point.

Yield Spread Premium in Action

Suppose the lowest home loan refinance you can find on a $275,000 mortgage is 6.25 percent. Your broker charges you 1.5% for the loan origination fee, even though one percent is perfectly reasonable. What your broker isn’t telling you is that you actually qualified for a 5.5 percent mortgage rate and they marked it up to 6.25 percent to get a 3 percent commission from the lender on top of the 1.5 percent origination fee you’re already overpaying. What does this unnecessary markup do to your payment? Your payment on a 6.25 percent fixed rate home loan for 30 years will be $1,693 per month. If you had the mortgage rate you deserve at 5.5 percent your payment would only be $1,560 per month. That’s a savings of $1,596 per year!

The good news is that you don’t have to be a personal finance guru to get the kind of deal I’m describing here. You simply have to find the right person to arrange your home loan refinance. When it comes to brokers local and self-employed are the way to go. These brokers will be much more likely to negotiate the kind of home loan refinance we’re discussing here because they don’t have the operating expenses of national chains. How can you find the right broker for your next home loan refinance?

Start by telling potential brokers that you understand Yield Spread Premium and will not accept any home loan refinance that includes the markup. Offer to pay a reasonable free for loan origination of one percent and you’ll be well on your way to refinancing your home loan with a wholesale mortgage rate that doesn’t include this unwanted markup.

You can learn more about getting wholesale mortgage rates for your next home loan refinance with my free Underground mortgage videos.

httpv://www.youtube.com/watch?v=be9md0A0_2c

Here’s a quick sample that spills the beans about your mortgage broker’s dirty little secret…