If You Think You'd Like To Refinance Your Home Mortgage

If you've heard your friends or relatives talking about how they have refinanced their home mortgages and are enjoying their new, lower interest rates, you may have wondered how you can join them. But understanding the refinancing process can be somewhat confusing.

Deciding to refinance your home mortgage means that you will borrow the money to pay o ff the balance o n your existing mortgage, and by borrowing at an interest rate lower than that on your current mortgage, you will lower your monthly payments. Refinancing your mortgage at lower interest will not only save you money each month; it will save you thousands of dollars over the course of your loan.

The Refinancing Process

The refinancing process, while fairly straightforward, does include several steps.

* After investigating various lenders to see which ones seem to have the best refinancing packages, you should choose the one which looks the most promising and complete a loan application.

* The loan officer will look at you application and make suggestions as to which loans would work best in you case. After careful examination, you should select one and apply for that particular loan, supplying the necessary documentation.

* You will then receive all the loan disclosures, terms, and legal forms, which you should study, complete, and return to the lender.

* The lender will take over at this point, sending an appraiser to place a value on your home. The lender will send all of the information to the loan underwriters, who will either approve your loan or ask for any further documentation they need. Your lender will supply them with your contact information.

* If your refinancing loan is approved, your lender will use it to pay off your existing mortgage and then process your file. Your loan papers will be sent to the title company or an attorney for closing, and you will have seventy-two hours during the closing process to change your mind without being penalized.

* At the end of the seventy-two hours, your loan will have closed, and your mortgage will be refinanced. You'll really appreciate what that means when you make your next, and smaller, monthly house payment!

Finding A Lender

If making the decision to refinance your home mortgage now seems less intimidating and more manageable, you should start looking for a reputable mortgage lender. You might even consider the company which currently holds your mortgage, because they will be highly motivated to help you refinance your home mortgage, even at a lower interest rate.

If you want to search for a new lender, you can begin online. There are hundreds on Internet websites offering to help you refinance your home mortgage, and by reviewing their loan packages you will be able to get an idea of what is currently available.

Many of these services have side-by-side mortgage comparison charts, which really help streamline your search. They also let you start the loan application process online.

If you would be more comfortable working with a brick and mortar lender in your area, you can use the information you find online to bargain for the best refinancing terms. The home refinancing market is an extremely competitive one, and you definitely do not need to grab the first offer which is presented!