When people refinance their homes, they often want to stick with the mortgage lender they already have. Many homeowners grow accustomed to whatever agreement they signed on to before. Switching things up can appear risky and intimidating, especially when a mortgage is being swapped out.
However, refinancing gives homeowners a chance to find a lender who offers better deals. No matter how satisfied a person is with the current framework, it’s not good to miss on real estate investment opportunities.
One of the most daunting aspects of refinancing is the accumulation of closing fees. Title searches and home appraisals are just a few services a lender can charge the borrower for, and these fees can be very high. While some lenders may offer discounts to retain a client, it’s wise for a homeowner to peruse the market and look for more reasonable closing fees. Especially when credit is offered to cover some of the fees, there are probably lower interest rates out there.
Many homeowners don’t see anything wrong with their mortgage rates until they have a reference point. Also, shopping around can be time-consuming. But all the homeowner really has to do is speak to about three lenders and compare quotes. This should give enough information on what the best option is.
People often think that if they stick with the servicer they’ve been with, they won’t have to do as much work when refinancing. The truth is that the application process is usually just as comprehensive with new lenders as it is with a current lender. Oftentimes a person’s loan servicer doesn’t offer mortgage refi rates, and when it does, a lot of paperwork is involved. Switching lenders is not as arduous as it may seem, and in some cases, application is actually easier.
Sometimes homeowners don’t feel comfortable working with an unfamiliar lender. Especially when it comes to a real estate investment, a person wants to work with someone trustworthy. However, just like with rates and fees, it’s hard to judge a lender’s general services when there’s no other lender to compare with. A homeowner should consider the loan officer’s responsiveness, focus, and informativeness. There might be other lenders who treat their clients better overall.
Of course, there are times when a person should stick with his or her current lender. It’s just important to look around when refinancing. Better alternatives can help a person reap the rewards of a real estate investment and save time, money, and energy.
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