Do You Have To Pay Closing Costs On A Refinance?
Posted by @TopMortgageRate
So you've been thinking about refinancing your mortgage? Perhaps you missed out on the recent ultra-low mortgage rates of recent months but the current rates are still lower than what you're paying now? Or maybe you're thinking that mortgage rates might dip back down again and you want to be ready to take advantage when they do?
The key question you have to ask yourself is, will refinancing save you money? It's not enough just to obtain a lower interest rate - a big part of the answer to that question depends on the fees you'll need to pay to refinance.
A refinance is just a new mortgageIt shouldn't come as any surprise that refinancing your mortgage is going to cost money. After all, refinancing a mortgage loan basically means issuing a new mortgage for the same property - so naturally, you're going to be paying many, but not all of the same closing costs you did when first buying your home. And if you're not careful, those fees can quickly eat up any savings you realize from refinancing your mortgage.
It doesn't matter whether you're going through a goverment program such as Making Home Affordable or working directly with a lender on a private refinance - you'll still have to pay closign costs.
According to the Federal Reserve, borrowers can expect to pay from 3 percent to 6 percent of their outstanding balance in fees when they refinance a mortgage. That means any reduction in your mortgage rate has to balance out those fees to make refinancing worthwhile. For most homeowners, that usually means about a 1 percent reduction or more, although those with a jumbo or other large mortgage may be able to benefit from even smaller reductions, since the potential savings are greater.
Just like with a purchase mortgage, closing costs offer an opportunity for some lenders to pad on additional fees you may not or should not have to pay. Some fees are fairly standard and unavoidable, but there are others you may be able to get waived or reduced through
negotiating or simply going to another lender who doesn't charge them. All should be disclosed in your Good Faith Estimate and the HUD-1 Settlement Statement provided before closing.
The U.S. Real Estate Settlement Procedures Act specifies that the HUD-1 should be provided to you at least a full day before closing, though in practice some lenders may provide it only a few hours before. Reviewing it in advance will give you the opportunity to identify and challenge questionable fees. If you wish, you can also hire a real estate attorney to review the document; this may cost several hundred dollars, but should provide assurance that you're not paying for anything unnecessary.
Guild is growing from its Western roots
Guild Mortgage is licensed in 47 states, with 250 local offices in about 25 of those states.
With roots in California, Guild Mortgage has a higher profile in the Western states, including Colorado and Idaho, and has a “growing presence” in Utah, says Terry Schmidt, chief financial officer. Schmidt also says the lender is active in the South, particularly in Texas, Georgia, South Carolina, North Carolina and Alabama, and has plans for further expansion in the central U.S., as well as on the East Coast.
Read entire article on MortageLoan.com
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