Low Refinance Rate, Save Great
The majority of your mortgage payment goes toward paying interest. To save an astounding amount of money over the long term, choose a mortgage loan with a lower rate and a shorter payback term. A 15-year mortgage may be just what the financial planner ordered. This type of loan carries a larger monthly payment; but if your budget can withstand the jolt, you can save big bucks over the long haul.
Credit Cards: Know When to Fold 'em
Lenders like pristine credit reports. If you have a bunch of open credit card accounts that you never use (and who doesn't?), consider closing them. It will boost your credit score and make you a much more attractive borrower to a lender. Then, a month after you've closed your accounts, go over your credit report with a fine-tooth comb. It should read that the accounts were closed at your request. (You don't want lenders to think someone cut you off and that you're a bad credit risk.)
Pay Points, Prevent PMI
You can also save money on your mortgage refinancing by paying "points." This is a fee that effectively lowers the interest rate of your loan. If you plan on staying in your home for a long time, this long-term strategy can be an excellent way to save thousands of dollars.
Another way to cut costs is to avoid Private Mortgage Insurance, or PMI as it's commonly called. PMI is insurance that lenders require you to carry if you are borrowing more than 80 percent of a home's value. This can cost you hundreds of dollars annually. If possible, don't rush out and buy that new bedroom set before your loan closes. Instead, put more money down on a home and avoid PMI.
Check and Double-Check those Refinancing Fees
Before you refinance a loan, make sure that you carefully analyze any fees that your lender is including on the loan. The Department of Housing and Urban Development can provide you with a list of standard fees. Use it to make sure that your lender isn't tacking on anything extravagant. And by all means, compare their fees with other lenders in the market.
Sounds simple, doesn't it? You'll be amazed at how much money just a few tactics like these can save you. Follow them diligently, and you'll find the payback well worth the effort. You'll have money for a lot more than just a bedroom set-perhaps a whole new bedroom as well.
Start here to compare refinance rates from top lenders in our network.http://www.mortgageloan.com/tips-for-cutting-mortgage-refinancing-costs
