Tips On Refinancing A Home To Get The Best Deals
Certainly when it comes to refinancing your home there are a number of benefits that you can gain from doing so.
The main one of all of these is that it can end up saving you hundreds of dollars each year in repayments.
But in order to make sure that you get the best deals possible if thinking about a refinance loan or mortgage we provide some useful tips on refinancing a home below.
Tip 1 - Look Out For Penalties - It is crucial that before you actually choose to start to look for refinancing facilities you need to check if there are any pre-payment or early repayment penalties attached to your current loan or mortgage.
Unfortunately a large number of people after taking out a loan or mortgage find out too late when it comes to refinancing that they will have further costs to pay to their current lender.
In some cases the amount that will need to be paid back to the lender can be as much as 6 months worth of interest on the amount that they have initially borrowed.
Tip 2 - Lock Ins That Are Free? - If when looking for a free lock in on a refinance loan then try those lenders who offer it for more than 60 days.
Remember when it comes to refinancing from the date you apply to the loan actually being closed can take upwards of 45 days to complete.
But be careful because although some lenders as saying their lock in is free you may actually find that they charge an additional fee or increase the rate of interest you are paying in order to provide them with lock in protection.
Tip 3 - Compare The Interest Rates - When you do start comparing the various different interest rates that lenders are offering you do so using a constant number of points system.
So in order to be able to compare the rates effectively it is important that you convert each one using the same points system.
To do this you will need to carry out the following.
What you need to do is for each quarter of 1% of the interest rate the lender is charging you give it a point.
So for a long which comes with an interest rate of 8% but zero points is exactly the same as one that has a rate of 7.
75% but 1 point attached toit.
To put this more easily 8% = 32 points ( 8 x 1/4 = 32) and 7.
75% plus 1 point also equates to 32 points (7.
75 x 1/4 = 31 + 1 point).
Tip 4 - Go For Pre-Approval - If you choose to go down this route when it comes to refinancing you often find that the rate of interest may be even lower than you first imagined.
If you do go this route then make sure that the lenders you are arranging pre-approval through do not pull your credit history when you do apply for such.
Instead look for those that allow you the right to only get your credit history pulled after you have made the decision to go with them for your refinancing purposes.
Tip 5 - Get Closing Costs and Interest Rates In Writing - When you are looking at the various different types of refinancing packages available get the lenders to provide you with written details of their closing costs and interest rates.
As well as asking for these details also ask them to provide you with details of any penalties that you may incur if you choose to repay the loan prior to its term being up.
There are some lenders who do not like to provide this kind of information because they are afraid that they may actually scare potential customers off from using them.
As well as using the tips on refinancing a home loan or mortgage when thinking about using such a financial facility you need to carry out as much research as possible.
The more research that you carry out then the better you will be able to understand what kinds of loans are available.
Which in turn will ensure that you can find a really good deal which will help you to save money.
The main one of all of these is that it can end up saving you hundreds of dollars each year in repayments.
But in order to make sure that you get the best deals possible if thinking about a refinance loan or mortgage we provide some useful tips on refinancing a home below.
Tip 1 - Look Out For Penalties - It is crucial that before you actually choose to start to look for refinancing facilities you need to check if there are any pre-payment or early repayment penalties attached to your current loan or mortgage.
Unfortunately a large number of people after taking out a loan or mortgage find out too late when it comes to refinancing that they will have further costs to pay to their current lender.
In some cases the amount that will need to be paid back to the lender can be as much as 6 months worth of interest on the amount that they have initially borrowed.
Tip 2 - Lock Ins That Are Free? - If when looking for a free lock in on a refinance loan then try those lenders who offer it for more than 60 days.
Remember when it comes to refinancing from the date you apply to the loan actually being closed can take upwards of 45 days to complete.
But be careful because although some lenders as saying their lock in is free you may actually find that they charge an additional fee or increase the rate of interest you are paying in order to provide them with lock in protection.
Tip 3 - Compare The Interest Rates - When you do start comparing the various different interest rates that lenders are offering you do so using a constant number of points system.
So in order to be able to compare the rates effectively it is important that you convert each one using the same points system.
To do this you will need to carry out the following.
What you need to do is for each quarter of 1% of the interest rate the lender is charging you give it a point.
So for a long which comes with an interest rate of 8% but zero points is exactly the same as one that has a rate of 7.
75% but 1 point attached toit.
To put this more easily 8% = 32 points ( 8 x 1/4 = 32) and 7.
75% plus 1 point also equates to 32 points (7.
75 x 1/4 = 31 + 1 point).
Tip 4 - Go For Pre-Approval - If you choose to go down this route when it comes to refinancing you often find that the rate of interest may be even lower than you first imagined.
If you do go this route then make sure that the lenders you are arranging pre-approval through do not pull your credit history when you do apply for such.
Instead look for those that allow you the right to only get your credit history pulled after you have made the decision to go with them for your refinancing purposes.
Tip 5 - Get Closing Costs and Interest Rates In Writing - When you are looking at the various different types of refinancing packages available get the lenders to provide you with written details of their closing costs and interest rates.
As well as asking for these details also ask them to provide you with details of any penalties that you may incur if you choose to repay the loan prior to its term being up.
There are some lenders who do not like to provide this kind of information because they are afraid that they may actually scare potential customers off from using them.
As well as using the tips on refinancing a home loan or mortgage when thinking about using such a financial facility you need to carry out as much research as possible.
The more research that you carry out then the better you will be able to understand what kinds of loans are available.
Which in turn will ensure that you can find a really good deal which will help you to save money.
