Alright, so the mortgage rates are at their lowest in the history. Even though you refinanced only two years ago, you are ready to refinance again. Heck, you have no choice, rates being so low. It does not make sense not to refinance.
So you start shopping. You hit the worldwide web. When did you read those words last? It is Google now. You enter the word ‘mortgage‘ or ‘mortgage refinance‘ or ‘refinance‘ or ‘best mortgage rates‘. The result. Hundred of thousands of mortgage web sites. You want to give up.
But you have to refinance. So you come back and find few mortgage brokers or lenders. How on earth they can offer different rates and fees. Some rates are too low to be true. At least so it seems.
Next, you start calling the mortgage companies. You get three different quotes. Finally you pick a company but you think rates are going to go down. The mortgage company wants you to fill out a loan application. You do not want to. You want to see if the rates will go down on Monday.
Monday comes and the rates do go down a bit. The mortgage company says let’s get you going. You want to wait as you think the rates will go down a bit more.
It is Thursday again. You are at work and guess what? Rates have dropped to the lowest ever. You decide it is time to refinance but you are at work. So you have to wait till next day.
Friday morning you check the rates and find out that rates inched back an 1/8th of one percent. You pick up the phone and ask the broker if their rates are still the same. You are ready to apply. No, their rates did go up too. The broker asks if you did fill out a loan application? “No, not yet.” you answer. The broker politely repeats again what he has been telling you all along to fill out an application. Finally, you agree and fill it out. The brokers emails you all the disclosures which you have to sign before he can lock your mortgage rate. You review the disclosures and fax them back to the broker and authorize him to lock the rate.
This is what you had never expected. The unexpected has happened. The mortgage broker says he can lock it but the rates went up again in the afternoon by another.25%.
You get frustrated and give up and tell the broker to lock it in anyway.
So, you end up paying.375% more because you did not do one thing. If you would have done this one thing, you would have total control over the process and no stress and no frustration. That one little is your Loan Application.
So, next time you want to refinance, fill out the loan application right away and the the package ready to lock. Instruct the broker not to pull your credit report till you are ready to lock. Even better if you can give him a target rate. It is like buy and sell stocks at a pre-determined price. That way he already has your loan application and he can lock in the rate the minute they come down to where you want them.
And one more thing. When you find a broker that has lower rates than everyone else, give yourself credit for finding him. Most people get skeptical. No need to be skeptical. Get a written quote and compare. More than likely his rates are lower and also true.
Now you know an easy and simple way to get the mortgage rate you want. Fill out the loan application and get the loan package ready to lock. Abraham Lincoln said, ” Be ready for the opportunity will come.” So if your loan package is not ready then even if the rates come down it will do you no good because you will not be able to move fast enough.
Good luck on your next refinance.
Amarjit Ahluwalia is the author of Make Your Money Make Money For You – a step by step guide to Trust Deed Investments. The book shows you how to earn 10% or more on your savings.
Keep in mind money is not power, knowledge is.