Evaluating Refinance Options
It is important to recognize how rare and unique this time period is, especially when prices are still good.
Refinancing buys you time, you have more of your own money available for other uses, and your payments are more manageable. Negotiate out the fees and penalties as much as possible, and you couldn’t wish for a better outcome.
Refinancing may not work out as well if you have negative equity, (aka “under water” where your current mortgage is more than the home can be sold for today). Most lenders are not going to be interested in refinancing in that scenario unless they can take significant fees up front and substantial penalties along the way.
One thing to be aware of: Going to a bank to apply for a mortgage is like going to a Toyota dealer, not the auto-mall. The bank only sells the bank’s brand products. That is one of the reasons why you should consult a mortgage broker instead of bank: They have multiple sources for financing, and they know the lay of the land with regards to the market for competitive rates and fees. I have had many experiences where borrowers lose a home purchase after their “bank” reversed their initial approval less than 2 weeks before closing. There is no financial consequence to your bank representative for not approving a mortgage. Mortgage brokers, on the other hand, DO NOT GET PAID unless the loan actually goes through.
Contact us to be introduced to the mortgage brokers we use, and get a better idea of the best rates and terms across the board, and what financing offerings might work best for you.