Refinancing a Mortgage Cost

• Refinancing a mortgage can cost as much as 3 percent to 6 percent of the amount borrowed, or $4,500-$9,000 to set up payments on a debt of $150,000, according to BSCAlliance.com^[1] . That estimate includes a $75-$300 application fee, a $150-$400 appraisal, a $175-$350 home inspection, $75-$200 for lenders' attorneys fees and other charges.
• Companies such as INGDirect.com^[2] don't charge application, processing or other fees, lowering the cost of refinancing to about $1,500-$2,500. The trade-off is usually slightly higher interest rates.

• Refinancing simply means replacing your current mortgage with a new one that has (you hope) better terms, such as a significantly lower interest rate, avoiding a balloon payment, cutting total costs by repaying the loan more quickly or other factors. FederalReserve.gov gives step-by-step instructions for finding the best possible mortgage, including a glossary of common terms and a detailed worksheet for comparing potential mortgage offers.
• Some company-sponsored online mortgage "calculators" give a somewhat rosy view of the benefits of refinancing; MtgProfessor.com^[3] lists the payoffs and potential hazards of refinancing, and provides a break-even calculator to accurately assess your situation. This site also provides a range of mortgage calculators^[4] for almost every possible circumstance.
• Traditional mortgage brokers make a profit by marking up the wholesale mortgage rates and consumers don't know the true cost of the loan until after the application is submitted. A new trend is upfront mortgage brokers, who disclose their total fee in advance, in writing; Sideroad.Com^[5] gives an overview.

• Some "predatory lenders" urge refinancing when it's not in the homeowners' best interests or charge fees for unnecessary or nonexistent products or services; HUD.gov^[6] lists tips to avoid loan fraud.

• Refinancing some existing FHA mortgages can be streamlined^[7] , which means less documentation (such as no appraisal and therefore no appraisal fee)--but setting up the new mortgage still costs money. The amount depends on the size of the loan and the lender's terms.
• Your current loan payment may include mortgage insurance, which covers your lender, not you, and runs $500-$1,200 annually for a $200,000 mortgage You might be able to cancel this insurance when refinancing if your equity in your home is more than 20 percent; MtgProfessor.com^[8] gives an overview.

• MtgProfessor.com ^[9] gives a quick overview of possible hazards and four approaches: responding to a solicitation, using an upfront mortgage broker, using a fixed-market lender and shopping online. Some websites suggest applying to your current lender first, because the it will offer the best deal in order to keep your business.
• Sites such as MortgageLoan.com^[10] and LendingTree.com^[11] provide several quotes. Be sure an online broker represents a number of lenders and not just one; Sideroad.com^[12] gives tips and guidelines for using online services.
• The Upfront Mortgage Brokers Association^[13] explains this type of service and providers referrals to its members.

1.  www.bcsalliance.com/y_mortgage_refinance.html
2.  /home.capitalone360.com/
3.  www.mtgprofessor.com/Tutorials2/refinance_to_reduce_cost.htm
4.  www.mtgprofessor.com/calculators.htm
5.  www.sideroad.com/Mortgage/upfront_mortgage_broker.html
6.  portal.hud.gov:80/hudportal/HUD?src=/program_offices/housing/sfh/buying/loanfraud
7.  portal.hud.gov:80/hudportal/HUD?src=/program_offices/housing/sfh/buying/streamli
8.  www.mtgprofessor.com/A%20-%20PMI/how_do_i_cancel_pmi_(i).htm
9.  www.mtgprofessor.com/Default.htm
10.  www.mortgageloan.com/refinance-mortgage
11.  /www.lendingtree.com/
12.  www.sideroad.com/Mortgage/online-mortgage-broker.html
13.  www.upfrontmortgagebrokers.org/about-us/

Check Out All Costs for Personal Finance		How Much Does Closing a Home Cost?		How Much Does a Traffic Ticket Attorney Cost?		How Much Do Funeral Flowers Cost?

Today's Featured Cost Articles

Is this the summer to finally take those swimming lessons? A BBQ grill could be handy with Memorial Day coming up. Spring has sprung. Are you thinking about allergy shots? Mother's Day is coming up. We cover the cost of massages and other spa treatments. April is craft month. We have the cost of scrapbooking and other crafts.

About CostHelper

CostHelper is based in Silicon Valley and provides consumers with unbiased price information about thousands of goods and services. Our writers are experienced journalists who adhere to our strict editorial ethics policy.

CostHelper Community

Portneuf medical hospital ER Paid: 210.00 they told us that the bill for the ER visit was only $210. later on we receive a bill for $1000. i got around 4-6 blood tests. all im mad about is that they lied to us... [more] -Gino Smile Blood Tests Cost Renovation ducting...never had central AC Paid: 1250.00 Renovating a guest house that never had central AC, therefore had no ducting...owner removed the ceiling as it had to be replaced anyway... [more] -CPace Ductwork Cost Flu symptoms Paid: 5932.68 Couldn’t stand headache pain when I caught the flu in March 2019. Threw up pain relievers, couldn’t eat or drink. After 5 hours of pain decided to hit ER... [more] -GayLynn Emergency Room Visit Cost Financing Paid: 20000.00 How do people afford wells? No one finances?... [more] -Kourtney Well Drilling Cost 1 yr 23lb Male Neuter Paid: 424.08 The price would have been $282.08, but I opted for the blood work and to have it done via laser versus scalpel. I was still surprised by the cost, but I didn't really have anything to compare it to... [more] -Joelle Dog Spay or Neuter Cost Is this cost of tax preparation correct Paid: 1845.00 Each year our tax preparation cost goes up faster than inflation. we started at $800.00 in 2012 and now our bill for preparing taxes this year is $1,845.00... [more] -smallbizchris Business Tax Preparation Cost