If you decide to refinance your mortgage, you will probably save a lot of money. People who bought their homes when interest rates were higher can now get a lower monthly payment because interest rates are going down. Also, refinancing lets you change a mortgage with an adjustable rate to one with a fixed rate. Many lenders offer attractive refinancing packages. Because of this, it's important to get quotes from more than one lender.
Why it's a Good Idea to Compare Mortgage Refi Lenders
You don't have to compare what each lender is offering. Some people don't even do this step. Still, you can get the best loan deal by comparing and contrasting the different offers. Rates and terms vary from lender to lender. Some mortgage lenders only care about how much money they can make. So, they might not have the best price.
When homebuyers compare offers from different lenders, it's easy to spot companies that might be trying to scam them. For example, if three lenders give you a quote for a refi loan with a rate of about 5% and the fourth lender gives you a quote for a loan with a rate of 7%, it's possible that the fourth lender is trying to take advantage of you. This happens a lot to people who have a bad credit history.
How to Compare Refinance Lenders
Many homeowners choose to keep their current mortgage lender when they refinance. There are good things and bad things about this choice. If you've been paying on time, your current lender will want to keep you as a customer. This gives you the ability to bargain. There are closing costs when you refinance. If you use your current lender, you might be able to get some fees waived, which would lower your closing costs.
On the other hand, if you don't get along well with your current lender, you might want to look for a new one. You can ask banks or credit unions about refinancing loans by calling them.
Homeowners are advised to get quotes from at least four different refinance lenders. Of course, it takes time to ask for quotes and fill out applications for different lenders. But the Internet makes it easy and quick to compare refinance offers. Just ask a mortgage broker for a quote by filling out an online form. The broker will sort through refinance loans and find the best ones for you based on the information you give them.
