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Ten Suggestions to Help You Refinance Your Home Loan

By Gabriel Traverso
NFNS Columnist


Interested in refinancing your mortgage? Use the following tips to help the process move smoothly:
  1. Do some homework on the mortgage lender. Not all states require that mortgage brokers are licensed to do business.
  2. Ask for references if you have never worked with the lender before.
  3. Watch out for deals that sound too good to be true. Make sure that you know what the current rates are and what you might qualify for, given your credit.
  4. Shop around! Check rates, fees, points, and other requirements with multiple lenders. Mortgage refinancing is a very competitive business and the first loan offer you get may not be the best.
  5. Ask questions. If there is something you don't understand about the mortgage refinance go over it with your loan officer until everything is clear to you.
  6. Get your loan offer in writing. Make sure it's signed and on company letterhead.
  7. Ask for a lock-in. This is a written document that lists the rate you've been offered and gives you time to evaluate the loan.
  8. Don't sign anything until you understand everything about your home loan. Refinancing your mortgage is a major purchase--make sure you understand all the terms and don't have any questions before you move forward.
  9. Find out if there are any prepayment penalties. Some home loans, especially adjustable rate mortgages (ARMs), offer a low introductory rate but carry a penalty if you refinance too soon.
  10. Make sure you can afford the payments, especially if you are applying for an ARM or other alternative home loan. Before you sign anything, make sure the lender explains how your rate and payment can change over time.
Getting a home loan refinance doesn't have to be a painful process. Do your homework ahead of time and make sure to check with more than one lender. Write everything down and don't continue until all of your questions are resolved.

How to Refinance

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