No cost refinancing usually means that the lender agrees to pay all normal closing costs when refinancing a mortgage. Some of these costs include the loan origination fee, appraisal fee, credit report fee, attorney's fees and title fees. One reason to consider no cost refinancing might be because of job loss or a job change resulting in lower income. Current monthly payments may be too high to maintain and as a result payments are late and charges are mounting up. Late payments are resulting in a lower credit score and credit history is being damaged. Damaged credit history will mean paying higher interest and fees for future purchases. To avoid damage to credit consider refinancing with a lower interest rate. This should also result in a lower monthly payment and shorter payoff terms.
Today's market still reflects low interest rates for mortgages. Now is a good time to consider refinancing to take advantage of these current rates before they increase. Many lending institutions and mortgage companies offer competitive rates along with many other advantages. No loan fees, or up front costs to borrowers. Some companies advertise no appraisal needed and no income verification. If a consumer has been faithful to make payments on an existing mortgage it is very easy to acquire a new agreement with limited hassle. "And he said unto him, Well, thou good servant: because thou hast been faithful in a very little, have thou authority over ten cities" (Luke 19:17).
When considering no cost refinancing, think about changing an adjustable rate to a fixed rate. Acquiring a low fixed rate will mean that the interest rate will remain the same over the entire life of the loan. It won't fluctuate with changing markets. If the borrower already has a fixed rate then it is possible to refinance with a lower interest rate. Some lenders guarantee that there will be no cost charged to the borrower nor will any of the costs will rolled into the agreement. With this type of offer how can one go wrong? More than likely the consumer who takes advantage of this type of deal will end up paying much less for their home in the long run.
Many lenders online offer no prepayment penalties on no cost refinancing. Do a search on the Internet and ask for a free quote. Mortgage companies may require current mortgage payment history. Additional documents needed may vary depending on the institution. It is important to get competitive comparisons on mortgage loans since some companies have stipulations that might apply. Some organizations offer to pay all the closing costs to refinance a mortgage but they don't offer competitive interest rates. Be sure to ask about other fees that might apply with this type of loan.
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