Your Questions About Mortgage Refinancing

Michael asks…

How does refinancing a mortgage work?

I’ve seen that you can put down as low as 3% for a down payment on a home but I know it’ll cost more for monthly mortgage payments this way. How does refinancing a mortgage work? Would someone be able to put down 3% and then later on refinance to a better interest rate?

Thanks!

John answers:

With interest rate as low as it is now. No point of getting refinance later. Now it’s almost 5%. Unless interest rate drop to about 3.5%, dont even bother to consider refinance. Refinancing is when you borrow a new loan to terminate your current loan. Fee to consider when refinancing, pre-payment penalty fee(from you current loan for not carrying out the full term of the loan), new loan application fee(usally 1-2% of the new loan amount), and of course some closing fees (small fee for lawyer and documentation).

Linda asks…

Is it a bad idea to apply for a credit card while in the middle of a mortgage refinancing process?

I have a high credit score (760), and was approved for my bank’s best rate. The refinancing process is taking awhile, and I would like to get a better rewards card than what I have. Would it be a bad idea to apply for a new credit card before the refinancing closes?

John answers:

If you are looking for the best mortgage refinancing site, try this site

http://best-mortgage-refinancing.com/

Here you can find the lowest interest rate in your area

Donna asks…

How do I get my name off a mortgage without refinancing.?

I recently went in with my parents on a 5 year fixed mortgage. They could afford the house without me but I put my name on it to get a housing allowance from my company. I now want to buy my own home but require my name off the mortgage in order to get financing (on my own). The banker said that my parents would have to refinance the mortgage and pay a fine for canceling the 5 year fixed mortgage. We just wish to remove my name not redo the mortgage.

John answers:

Unfortunately the banker is correct on this one. A loan is a contract between parties that once signed no party can change legally. I am not sure about the fees or anything, you can check with another mortgage company to see what their rates and things are.

You may want to see if your parents current loan as a prepayment penalty on it. If not then a loan through another lender for them would work.

In any case there is going to be the documentation fees for redoing the loan.

Sorry for the not good news.

Helen asks…

I am refinancing my mortgage, can I start to sell the house now?

I am refinancing a ballon to a fixed rate mortgage and in the agreement it says that I have to occupy the property for at least one year after refinance closing. Can I start to look for a buyer now tho?

John answers:

Yes. You can sell it in a month if you want. That language is there so that you agree not to turn place into investment property. It does not prohibit you from selling in less than a year

refi is expensive. Usually the cost requires 2-3 years to break even.

Steven asks…

I would like to go into mortgage refinancing as i heard its quite a nice idea, what are the benefits?

I just heard about mortgage refinancing and i would like to know what its benefits are

John answers:

Mortgage refinancing isn’t a bad idea.

Several benefits of mortgage refinancing are:

1. It helps you pay for a previous loan owed
2. It helps you cut down on all monthly payments you always pay for your loans
3. It helps you access other cash easily
4. It reduces your fear of not being able to pay off.

Thanks
Robert Mullen

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