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Mortgage Refinancing: Shopping for the Best Deal
By Gabriel Traverso
CMR Columnist
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When you bought your home, you probably saw at least a dozen houses before you decided on the best one. Shopping for a mortgage should be no different.
Compare Mortgage Rates
One of the first steps you should take when refinancing your mortgage is to compare current mortgage rates. Check the rates for 30-, 20-, and 15-year mortgages and aim for the shortest mortgage term you can get in order to save the most money over time. The next move is to start shopping for mortgage lenders.
Mortgage Lender Shopping
Checking with at least three lenders or brokers is a good idea, but any more than that and you're probably going to be spinning your wheels. When talking with each lender, make sure you get a quote using the same loan amount, term, and type. If you want to shop for different loan types then get a quote for each loan type from every lender. Make sure you not only compare the interest rates, but also the annual percentage rate (APR). The APR also accounts for the other fees you'll pay and gives a more accurate cost of the loan.
Mortgage Refinancing Doesn't Have to Be a Trial
The easiest way to approach this task is to create a worksheet. List the questions you want to ask each lender and the information you need in order to make your comparison. This will make the process much easier. Remember that if you are working with a mortgage broker, you also have the right to ask how much they are making on the loan. You may want to avoid brokers who are getting a nice premium from the lender as well as charging you hefty fees.
About the Author
Gabriel Traverso is a freelance writer, professional musician, and artist. He resides with his family in Reno, Nevada.
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