How to Get the Right Miami Mortgage Refinancing Loan for You

In this article, we discuss some of the tips you can follow to ensure you get the best possible deal the next time you try to refinance your home. These are some of the same tips you followed when you got your original loan. However, it’s good to go over them once again as a refresher.

First, look for any pre-payment or early repayment penalties. Before taking a new loan to replace your existing one, look over your current loan to check whether there are any penalties for early pre-payment. Depending on the loan you signed, you may have not pre-payment penalty or you may have to pay as much as 6 months worth of interest payments. You need to add this cost to the cost of getting the new loan. Of course, when you are looking at your new loan, try to get one with no pr-payment penalty.

Second, secure a Lock In (a free one preferably.) The Lock In ensures that the interest rate you have been quoted will stay the same for the duration of the Lock. The Lock can be anywhere between 30 days and 60 days. Even though most refinancing loans take under 30 days, you may want to get a 60 day one. In some cases, you may have to pay for the Lock In. The fee is usually a small one and it may be worthwhile paying to gain some peace of mind and avoid surprises the day of the closing.

Next, compare interest rates. Depending on your credit, you may be able to compare among available rates. When you compare rates, make sure you compare them in the same conditions. In order to make a fair comparison, remember that a point charged at closing is roughly equal to a ¼ of a point.

Also, have a good idea of the closing costs and interest rates that you’ll be charged in the new loan. The easiest way to get this information is by reading the Good Faith Estimate that a lender has the obligation to send you after completing the application. You may also ask for information such as pre-payment penalties in case you decide to pay the loan earlier. Please take into account that in most cases there will be some type of pre-payment penalties unless you are willing to pay a fee to have a clause in your loan to avoid the penalties.

Finally, remember that getting a loan is a big financial decision and the more you know about how the process works, the better it will be for you. The loan officer is here to serve you and educate you throughout the process. Don’t feel bad to ask any question that you may have; you are paying to have those questions answered!