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PostHeaderIcon Refinance Cost, Mortgage Cost & Lowest Mortgage Rate

When a client wants to refinance their existing mortgage there is a refinance cost. There are typically the same fees for all refinances. Costs of a refinance are lender fees, third party fees, and pre-paid items. Lender fees are made up of origination, points, application, credit report and appraisal. Pre-paid items are not typically known to be fees these are items you pay regardless of refinancing or not. Pre-paids contain the borrower’s taxes and insurance of their home. Third party fees are also part of a refi they are closing costs, title, and title insurance. Refinance fees can usually range from two to six percent of your loan amount. If a client is interested into refinance their current mortgage, they can ask the loan originator for a good faith estimate or GFE. There is also a way to finance the closing costs; this is usually done if there is enough equity in the home.

Mortgage cost can be simply explained, the costs that involved with a mortgage are all on explained on a HUD. A HUD explains everything that happened on the refinance or on the purchase, also it shows all the fees and how much each of them cost. These costs are usually lender fees, third party fees, and prepaid items. The lender fees are the origination fee, points and application fee, appraisal fee, and credit check. The origination fee is typically what the lender charges for the work in evaluating and preparing the mortgage loan. Points can either be discount points or buy down a point which is charged to the borrower to get the lowest interest rate. When a buy down is charges this means that the rate had a hit on it so then the lender charges the borrower an extra point to get that rate. An appraisal fee is typically 300 or 400 hundred dollar and this fee can be paid at the door. An appraisal must be done by a certified real estate appraisal. Applications can be taken over the phone or in person, some companies have a fee for an application and some don’t. Pre- paid item are not considered to be fees because these must be paid regardless or refinancing or not. The escrows are pre-paids which are the taxes and insurance of the home. These can be included in your monthly mortgage payment or not. Third party fees are the title and closing costs fees. Closing costs fees are underwriting and processing fees. The title fees are the cost of examining the public record to confirm ownership of the real estate property. This fee also takes care of the cost of a policy, typically issued by a title insurance company, which insures the borrower to a specific amount for any loss because of discrepancies in the title to the borrower property. All the costs can be explained on a good faith which can be given to the client upon request by the loan originator who is working on the loan.

There are many different factors that go into getting the lowest mortgage rates. To obtain the lowest mortgage rate is by having great scores, having a really low loan to value, and also having a single family. The refinance would have to be with no cash out to get the lowest rates. These are the factors that go into getting the lowest interest rates possible.

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