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Refinancing: Take the Low Road ^ | January 10, 2005

Posted on 01/10/2005 4:14:54 PM PST by The Loan Arranger

THINKING OF REFINANCING your mortgage? Welcome to the club. With mortgage rates so low over the past few years, the question hasn't been "should you refinance?" but "when"? While conventional wisdom once said you had to shave at least 2% off your loan in order for refinancing to make sense, these days it could be worthwhile with an interest reduction of just 0.75%, says Doug Perry of Countrywide's consumer-markets division. That's because soaring home values, increased competition and automated underwriting (which can approve or reject your refi application in a matter of minutes) have made refinancing quicker, easier and potentially cheaper than ever before.

Unfortunately, none of this means that your role in the process — namely, making sure that you get the best loan possible — has gotten much easier. To find the best deal, you still need to do your homework, and you need to be smart about the financing options that a lender or broker might pitch you. Otherwise, your refi just might cost you significantly more than it should.

So consider this your crib sheet. We'll give you the lowdown on some of the loan products you might be offered in this refi market, and also give you tips on how to work the system to get the best deal possible.

Timing Isn't Everything If you're worried that mortgage rates are soon going to rise to the point where refinancing is no longer appropriate for you, you obviously want to lock in a rate as soon as possible. Then, once you have a rate locked for, say, 45 days, probably the best thing to do is to ignore the direction of interest rates. After all, should rates actually drop, you're likely to wind up flagellating yourself outside your lender's office

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TOPICS: Business/Economy; Culture/Society; Editorial
KEYWORDS: adjustablerate; bills; cashout; debtconsolidation; homeequity; homeimprovement; homeowner; interestrate; mortgage; payoptionarm; refinance; refunance

1 posted on 01/10/2005 4:14:54 PM PST by The Loan Arranger
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To: All

Stay away from these companies!!!

Principal Residential Mortgage

Household Finance aka H.F.C.(Beneficial Finance has bought these guys out I blieve)

Americus Financial

And whatever you do, read the fine print!

Mortgage companies are notorious for "bait and switch" schemes. Get you on one rate and switch you to another; just like car dealers and almost as bad!
And look out for the closing fees, fees, fees, fees!!!

2 posted on 01/10/2005 5:23:41 PM PST by kellynla (U.S.M.C. 1st Battalion,5th Marine Regiment, 1st Marine Div. Viet Nam 69&70 Semper Fi)
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To: The Loan Arranger

Boy this thing is dated. Conforming loan limits changed to $359,600 last month.

3 posted on 01/10/2005 5:38:07 PM PST by GVnana (If I had a Buckhead moment would I know it?)
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