Refinance Questions

November 2nd, 2009

There are a lot of questions about refinancing, or at least there should be. The questions a consumer should be asking of a mortgage professional are:

1. What are the closing costs I have to spend to refinance?
2. Can I finance those costs into the new loan amount?
3. How much would I save by refinancing?
4. How long has the mortgage firm been licensed?
5. How long has the individual mortgage professional been licensed? And how long have they been with their current firm?
6. If you are being offered a “no closing cost” loan, are the costs simply being built into the rate so that you are paying simply paying a higher rate in trade for no costs?
7. What happens if your appraisal comes in lower than expected?
8. Will you be required to pay mortgage insurance?
9. If you have mortgage insurance on your current loan can you drop it?
10. How long is the interest rate locked-in for, and what is the turn around time on loan processing, underwriting, and loan document preparation?

And the questions that you “should” be asked by a mortgage professional are:

1. When did you buy the home?
2. What is the current rate on the 1st trust mortgage?
3. Do you have a 2nd trust/equity line, and if so at what rate?
4. Have you drawn on the equity line in the last 12 months, and if so how much?
5. What did you originally pay for the home?
6. What do you believe the home to be “realistically” worth now?
7. What is the balance of the loan amount/s?
8. Is this home your primary residence, a rental property, or a vacation home?
9. What is the property address?
10. What type of property is it, condo, single family detached, rowhome, 2 unit, 3 unit, or 4 unit?

If ALL of the above questions are not being asked of you, and if you are not asking the above questions, there is a strong chance you may not get what you bargained for!

And, you should read this blog post about whether or not you even should refinance in the first place: https://www.getloans.com/blog/?p=335#more-335.

Learn More: Questions to Ask a Mortgage Lender

Brian Martucci is a loan officer for Capital Bank Home Loans, a division of Capital Bank, N.A. He has been in the mortgage industry since 1986 and has served in a number of roles, including loan processor, loan officer, mortgage broker, branch manager, and vice president. Brian Martucci – NMLS# 185421. His opinions do not necessarily reflect the opinions and beliefs of Capital Bank Home Loans or Capital Bank. Capital Bank, N.A.- NMLS# 401599. Click here for the Capital Bank, N.A. “Privacy Policy”.

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