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

Make sure your gutters are clean before they start to fill up again this fall. Are you planning a Labor Day picnic? Need a new charcoal grill? Pruning trees before the storm season can help ensure dead branches won't imperil your home. Looking for help to take care of your garden? How much does garden service cost. The late August sun can leave a mark. Check out sunburn treatment options.

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

UTI urgent care visit Paid: 147.00 Visit was $135. Antibiotics was $12. Waiting for four hours in the waiting room and the visit was quick... [more] -nervouschomper Urinary Tract Infection Treatment Cost Spanish Medical Interpreter Paid: 150.00 I worked with SynShyne Services out of Monroe, NC. They were so worth the price! Professional, friendly, accurate, great attitude and always on time. I recieved an itemized report after every contact and a user friendly invoice weekly... [more] -Gregory Richardson Interpreter Cost Dat Paid: 495.00 This is how much I am paying... [more] -Calista Christian Dental Admission Test Cost Shingrix Paid: 48.00 ... [more] -Not that BB Shingles Vaccine Cost Skin prick allergy test Paid: 573.00 Took my 9 yr. old in after an allergic reaction to eggs. Several panels for nuts, fish & top 8 allergens. Sure enough, egg came up. Got a script for epinephrine and left... [more] -D’s mom Allergy Testing Cost Estimate for Teeth Cleaning Cat Paid: 0.00 13 year old cat …teeth extractions, X-rays, blood work, anesthetic, cleaning estimate 2 to 3 thousand... [more] -Terrimarie Cat Teeth Cleaning Cost