Depending on your situation, you may enjoy one or several substantial benefits by refinancing your current home mortgage. For example, you may set up a lower monthly payment, take advantage of a lower interest rate or even pull cash equity out of your home. However, there are many costs associated with refinancing your mortgage. Have you been sitting on the sidelines because of the belief that the costs are too significant? With interest rates on the rise, it makes sense to explore the benefits of a no-closing-cost refinance.
In most cases, a refinance loan comes with a variety of expenses. For example, a loan origination fee of up to 1 percent is common with refinance loans. There may also be costs for a new appraisal, a survey, title insurance, mortgage insurance, discount points and more. The reality is that these and other loan-related expenses can equate to 2 to 6 percent of your loan amount. If you are doing the math, you understandably may be floored by the total cost of those expenses.
Lenders generally will not waive these expenses. Instead, a no-closing-cost refinance means that the lender is wrapping up those expenses into the loan. As a result, you may have a slightly higher starting principal balance and a slightly higher mortgage payment. However, you will not need to come to the closing table with a large chunk of cash.
There is not a best option that applies to all situations. Instead, you will need to compare the refinance options available to you closely. Our loan origination team at MortgageDepot is available to provide you with quotes for a refinance loan with closing costs and a loan without closing costs. This will help you to decide if you should refinance at this time. To inquire about your options, contact the MortgageDepot team today.
Connect with one of our loan consultants to learn more.
Have questions or need help?
Call us now at 800-220-LOAN
Request a call back or email us your questions!
