Tips With the Loan Process
Buying/Refinancing
Here are some tips to help you with the loan process:
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Call a few lenders to check their rates. Make sure you also check what their fees are. Ask for a Good Faith Estimate in writing so you can compare rates, origination fees and costs.
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Your first calls should be to your local bank and/or the lender who currently has your mortgage. You can also check out bankrate.com, which even has a calculator that helps you determine if it is cost effective to refinance.
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Compare, contrast, and understand – look over the rates, loan origination fees and other fees. Make sure you understand the difference between negotiable lender charges and other standard charges. Title insurance, recording fees, and attorney’s fees are not set by the lender. Escrow amounts are based on your taxes and home owner's insurance rates.
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Negotiate with the lender – Tell one lender what a different lender is offering and see if they will lower your rate or take away some of the fees.
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Escrows – these are the amounts a lender holds for payment of taxes and insurance. They are allowed to have a cushion equal to one-sixth of the total amount of items paid out (or approximately a 2 month cushion). Depending on your credit risk, you may be able to forego establishing an escrow account. Many lenders charge a fee for this "privilege", but negotiating with them may waive the fee.
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