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PostHeaderIcon Refi Cost, Escrow Refinance & Refinance PMI

Refi costs are when a client refinances their mortgage, which consist of paying off their current loan and sign a new home loan. When a client does this, there are refi costs; refi costs can include settlement costs, titles fees, lender fees, discount points and also loan originator fees. A mortgage company can charge any where from one to two percent loan originator fees. A company may not charge as many costs, but this would mean that they would give you a much higher rate.  If a person decides that they want to have less refinance costs than this would mean their monthly payments would be higher than the client really gets approved for.

An escrow refinance is when a lender holds an amount of some sort for a new escrow balance. An escrow account is an account that is held in the clients name for things like property taxes and insurance premium. A question you may have is why do I need an escrow account? You would want an escrow account if you want the bank that you have the loan with to pay the taxes and insurance for you. If not, then you don’t need an escrow balance with your loan. Most clients like the idea of not having to worry about having to pay their taxes and insurance so they have the lender set up an escrow account.

What is a refinance PMI? PMI stands for private mortgage insurance. PMI is an extra insurance that the lenders have and ask for from a lot of home buyers, where there loan to value (LTV) is not under eighty percent. So when a client does a refinance they need to have their LTV under the eighty mark to get away from PMI. Now if a client is buying a home and do not put twenty percent down this will mean that they will have PMI. The reason for PMI is to protect lenders from a defaulting borrower. Having PMI helps borrowers to have more access to the ownership of their home. The idea of PMI is an increase but the monthly payments will decrease. Do you already have PMI and want to get rid of it. One way to do so is to contact a loan officer and have them do a refinance. Once the process of a refinance is started an appraisal must be done. If the appraisal amount put you eighty percent or lower on your LTV you will no longer have PMI.

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