If you are in the process of refinancing your mortgage you might wonder which lender is best for your situation. Does it make a difference if you refinance with a bank, mortgage broker, or Internet lender? The truth is that it does matter and choosing the wrong mortgage lender will cost you thousands of dollars unnecessarily every year you keep the loan. Here are tips to help you find the right lender when refinancing your mortgage.
Ask The Right Questions When Refinancing
Most homeowners focus on choosing the best lender or the lowest mortgage rate when refinancing. After all, isn’t shopping for a mortgage just like shopping for a washing machine? You compare rates and closing costs and choose the best offer right? That would be true if you were shopping for kitchen appliance; however, when choosing a lender you’re basing your decision on estimates that are guaranteed to change before you close on the loan.
If most homeowners ask the wrong questions when refinancing, what questions should you be asking? The question you need answered is not which lender should you choose, but which person should you pick to arrange your home loan. Finding the right person that allows you to refinance with wholesale mortgage rates while paying a one percent fee will save you thousands of dollars and many headaches.
Who Do You Choose To Arrange Your Home Loan?
First of all, should you pick an Internet mortgage site or a bank to refinance your home? Absolutely not! You should never refinance with a bank or credit union due to loopholes in the Real Estate Settlement Procedures Act that protects homeowners from abusive lending practices. The problem with those Internet mortgage sites you see on television is that you’ll be dealing with an inexperienced salesperson that does not have the authority to broker the deal you want.
Mortgage Brokers Are The Answer
If you want the best mortgage loan you’ll need to enlist the help of a mortgage broker; but not just any broker. You need to find a self-employed mortgage broker that owns their own business and does not employ a sales staff. The reason for this is that as the business owner your broke will have the authority to negotiate their commission and will not be splitting it with a salesperson. Why is this important? Because you’ll be refinancing your home with a wholesale mortgage rate and only paying a one percent origination fee. Sounds impossible? It’s not only possible but it’s much easier than you think for anyone that does their homework before shopping for a home loan.
Tags: Personal-Finance