If time happens to be on your side, and you don’t need to refinance your mortgage immediately, take some time to educate yourself about the mortgage industry.

By educating yourself about the mortgage industry, you are essentially putting yourself into the driver’s seat.

There is so much mortgage jargon, terms, and definitions that will be thrown at you when considering a mortgage refinance, that it is impossible for any one person to understand everything.

It is not necessary to become an expert in the mortgage industry. You just need to have somewhat of an understanding. This way, while you are shopping around for a mortgage refinance, your decision on which lender you want to work with, will be all the more educated.

The mortgage industry is a very competitive one, so by shopping around, and making it clear that you are shopping around to the lenders or brokers you are dealing with, they will be forced to come back at you with the best deal possible. They know that they are competing with other mortgage companies, and they will not want anyone else to get your business, so they will offer you the best rate available to them in order to keep your business.

Keep in mind when a loan officer or broker offers you a deal that sounds too good to be true, it just may be, so be careful. You don’t want to get to the closing table only to find out you are not getting what you thought you were getting.

Remember, before you commit to a lender, ask for everything they told you to be sent to you in writing, this way you won’t have any surprises at the table.

This is why it is so important to educate yourself about the mortgage industry.

With just a fair amount of knowledge, you will have a general understanding of what you are being offered, and you will be able to determine whether or not the deal is reasonable.

My suggestion to you would be to allow for up to four loan officers or brokers to assess your situation. Whichever one comes back with the best, and most reasonable deal, should be the one for you to consider.

Get a lower interest rate
Combine or pay off bills
Get money for home improvements or repairs
Things to consider before you refinance
Refinancing to get a lower interest rate will probably save you money if:

The new interest rate is 2% or more below the rate you pay now; and
You plan to stay in your home for three or more years.
If you refinance to consolidate bills and pay off debts, your total monthly payments may be less than what you pay now. However, your monthly mortgage payment will be higher. Be aware that if you get behind on your monthly mortgage payment, you can lose your home.

If you just need money for home repairs, you may qualify for a low interest government loan.

How do I find a lender?
Banks, mortgage companies and credit unions are the most common lenders. Here are some tips for finding a lender:

Contact three or more lenders. Look for a loan with the lowest interest rate, points and fees.
Be sure the lender is licensed and in good standing. Call the Department of Corporations at (800) 347-6995.
Mortgage loan brokers work with many lenders to help you find a loan. To be sure that they are licensed with the Department of Real Estate, call the local office.
How much will it cost to refinance?
Loan charges will vary from lender to lender. Loan charges include points and fees. Each point is equal to 1% of the loan and is paid to the lender or your loan broker. Be sure to shop around and negotiate for the lowest interest rate, points and fees.

What do loan fees include?
Loan costs may include the following fees:

Appraisal
Recording
Title Report

Escrow
Credit Report
Document Notary

Wire Service
Messenger Services
Document Preparation

Loan Origination

Do I have a right to cancel?
Yes. From the time you sign the loan papers, you have 3 business days to cancel. If you cancel, your credit report and appraisal fees are non-refundable. If you are refinancing a rental property, there is no right to cancel.

Before you sign
Review all loan documents.
The Truth in Lending Disclosure has the basic terms and conditions of the loan.
The Settlement or Closing Statement shows the fees you are being charged and what accounts are being paid off.
Everything you were promised should be in the loan documents. If you do not understand something, do not sign. Ask for an explanation.