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…

Lowest Refinance Rates & Mortgage Broker Fee

If you want the lowest refinance rates and mortgage broker fee for your next home loan there are several things you need to know to avoid overpaying. Did you know most of your neighbors overpaid their mortgage broker fee and didn’t get the lowest refinance rates because the broker marked up their interest rate? The good news is that you can get the lowest refinance rates without overpaying your mortgage broker fee. Here are several of my best tips for getting the lowest refinance rates without overpaying the mortgage broker fee for your next home loan.

Your Mortgage Broker Fee

The broker fee you pay when refinancing your home loan is for loan origination, meaning compensation for the broker’s work arranging your home loan. What is a reasonable fee to pay for loan origination? Many brokers charge two percent or higher; however, a reasonable mortgage broker fee is one percent of your loan amount assuming the broker has not marked up your lowest refinance rates.

The origination fee is easy to find and understand in your loan documents, but what about the hidden markup of the lowest refinance rates? The reason nearly all of your neighbors overpay when refinancing is because of a little known fee called Yield Spread Premium. What’s confusing about Yield Spread Premium is that the fee doesn’t come out of your pocket, it’s paid by your lender.

Getting The Lowest Refinance Rates

Why should you care about a fee paid by your mortgage lender? What should concern you is not the fact that your lender is paying Yield Spread Premium but why this fee is being paid. Mortgage lenders reward brokers that lock and close home loans with higher than necessary mortgage rates with the fee known as Yield Spread Premium. Did you know that the person arranging your home loan receives one percent of your home loan amount for every .25 percent they jack up your interest rate?

This unwanted junk fee is paid by the lender in addition to the origination fee coming out of your pocket. What does this unnecessary markup of your mortgage rate do to your monthly payment? Suppose your refinancing your home for $250,000 at 6.5% paying a mortgage broker fee of 1.5 percent. This origination fee amounts to $3750 that you’ll be required to pay at closing. Your payment on a thirty year fixed rate mortgage will be $1,600 per month. What the person arranging your home loan didn’t tell you is that you actually qualified for a 6.0 percent rate and they marked up your interest rate to 6.5 percent and over charged your mortgage broker fee.

If you had the mortgage rate you deserve at six percent your payment would only be $1498 per month. That’s $1,224 a year you’re throwing away because your broker took advantage of you… The good news is that you can get a new home loan paying a flat loan origination fee of one percent without this unnecessary markup of your mortgage rates.

You can learn more about getting the lowest refinance rates without overpaying the mortgage broker fee by checking out my free Underground Mortgage Videos.

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

Here’s a sample to get you started with a dirty secret your mortgage lender hopes you won’t find out about.

How to Avoid Mortgage Fat Cats When Refinancing Your Home Loan

Did you know that nearly all of your neighbors are currently paying too much for their home loans? Do you want the lowest home mortgage refinancing rates but don’t want unnecessary markup and junk fees? Refinancing your home is a lot like buying a used car and there are plenty of people out there trying to make a buck at your expense. Here are some of my best tips for avoiding the mortgage fat cats when refinancing your home loan that could save you as much as $1200 per year.

Unnecessary Mortgage Rate Markup

Did you know that the quotes you get online and over the phone all include markup to make a profit for someone at your expense? This is in addition to any origination fee you’re already paying this person for arranging your home loan. The good news is that you can avoid this unwanted markup of your home loan interest rate and lower your monthly payment allowing you to keep more cash in your pocket at the end of the month. Before we get to that I need to explain a little more about this markup of your home loan interest rate.

Mortgage Yield Spread Premium

Yield Spread Premium is a fee paid by your lender to the person arranging your home loan for locking and closing your mortgage with a higher than necessary mortgage rate. I say higher than necessary because your lender approved you for a specific interest rate; however, this person arranging your loan marked it up to receive Yield Spread Premium from the lender. The problem with this markup is twofold: first it drives your monthly payment taking more cash out of your pocket. Second, you’re already paying this person a perfectly good origination fee for their services, yet they’re taking advantage of you by collecting this fee from your lender.

Most of the mortgage fat cats will tell you since this fee is being paid outside of closing by the lender and isn’t coming out of your pocket that you shouldn’t worry about it. The problem isn’t the fact that the fee isn’t coming out of your pocket but why it’s being paid and what it does to your payment. Here’s an example to illustrate my point.

Yield Spread Premium in Action

Suppose for instance that you’re refinancing your home loan for $275,000. Your broker quotes you a mortgage rate of 6.5% and charges you a loan origination fee of 2%. This means that you’ll be required to pay $5,500 in origination fees at closing for the broker’s work on your home loan. Don’t get me wrong, brokers should get paid for their work, just not by taking advantage of their customers. Keep in mind that a reasonable fee to pay for loan origination is 1% of your home loan amount so this mortgage broker is overcharging your for the origination fee.

If you agree to refinance your home with these terms your monthly payment on a 30 year, fixed rate home loan would be $1,738 per month. What your mortgage broker isn’t telling you is that you actually qualified for a 5.75% interest rate and they marked it up to 6.5% to collect Yield Spread Premium. If you had gotten the home loan you deserve at 5.75% your monthly payment would only be $1600 a month. That’s a savings of $1,656 per year! The good news is that you can avoid this unnecessary markup of your home loan interest rate AND you don’t have to be some kind of financial guru to pull it off.

You can learn more about avoiding the mortgage fat cats when refinancing and getting a wholesale mortgage rate for yourself by checking out my free Underground Mortgage Videos.

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

Here’s a sample of what you’ll get today you register for my free password protected member’s area. This short video is about the Yield Spread Premium your mortgage broker tries to slip past you when refinancing your home loan.