Search thousands of topics on CostHelper.com

BROWSE ALL TOPICS >> babies & children  cars  consumer electronics health & personal care home & garden personal finance  pets  schools small business sports weddings
CostHelper > Personal Finance  > Real Estate > Refinancing a Mortgage

Refinancing a Mortgage Cost


How Much Does Refinancing a Mortgage Cost?

 
low costLow: $2,000 or lesshigh costHigh: 3-6% of total
post Post    
  Typical costs:
  • 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.
Related articles: Closing a Home, Selling a Home, Homeowner's Insurance, Flood Insurance

What should be included:
  • 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.
Additional costs:
  • 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.
Discounts:
  • 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.
Shopping for refinancing a mortgage:
  • 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.
post Post    
CostHelper News


Forgotten Expenses In a Home Addition Budget
Items like construction costs, permit fees or debris removal aren't the only expenses to consider when calculating the total costs of a home remodeling project. || Posted August 5 2013


10 Most Popular Cosmetic Procedures Before the Holidays
With reunions and other get-togethers scheduled during the holiday season, most people want to look their best at this time of year. For some, that means filling in those wrinkles with a bit of botox, or having a nip and tuck down here and there. || Posted November 23 2013

‣ All CostHelper Blog Posts


What People Are Paying - Recent Comments


 

Comment On Your Experience With Refinancing a Mortgage
 
Subject:  *
Amount Spent:  *
Company: Type of Mortgage: 
Points: Interest Rate: 
Comments: 
Purchased:  Year: 
City:  * State:  *
 
Information about you:
Email:  * Email addresses are not displayed.
Name:  This is the name we'll display with your post.
me on this computer
*=required field.
 



External Resources:
  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/
More Personal Finance Topics
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?

Search Thousands of Topics on CostHelper.com

 
Today's Featured Cost Articles

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
Windshield replacement
Paid: 560.00
... [more]
-Christine Brown
Windshield Replacement and Repair Cost
Outer CV Boots
Paid: 700.00
Both outer boots. Quoted about $350 each. Wish I had the time to take it to shop around like esyriac did... [more]
-DangerousCurveAhead
Replacing a CV Boot Cost
Cost of Annual Mammograms
Paid: 772.00
I Had a routine mammogram then had to have the right side repeated(needed a better reading). Insurance said it was not covered in our policy. Firelands Regional Medical charged me $241.00 for the routine mamo, then charged me $256... [more]
-MonaL
Mammogram Cost
DETAILED MY 2006 FORD FREESTYLE
Paid: 150.00
IS $ 150 TO MUCH TO PAY TO A PERSON TO DETAIL A 2006 FORD FREESTYLE IT WASNT WAX IT CLEAN BUT I THOUGHT DETAILING WOULD BE BETTER THAN IT REALLY LOOKS... [more]
-SHEILA DELOACH
Auto Detailing Cost
Expensive puppy shots
Paid: 91.00
2nd set expected to be 150.00 and 3rd 132... [more]
-Michael Gray
Puppy Shots Cost
I’m looking for a church, reception, and pastor to do our wedding at in or around Danville, Va
Paid: 200.00
I want a church to get married at we have never been married either of us and we don’t have a lot of money to work with but we still want to have a nice small wedding and reception in our area Danville or chatham... [more]
-Maurisa
Wedding Chapel or Site Cost