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The Lazy Homeowner’s Way to Refinance

Posted on | December 28, 2008 | 4 Comments

Refinancing is a top issue that is on many homeowners minds.  The problem is that it takes a lot of time and effort to refinance one’s home at a rate they are comfortable with.  Below are four ways the lazy homeowner can make refinancing an easier process.

1.  Know your credit score – Before you pick up the phone or step foot in a mortgage lenders office, make sure that you have a ballpark figure of your credit score.  If you have a strong score of 720 or higher, you will have greater say in what you “prefer” the refinance rate to be.  Experian.com is a site that has always worked well.  Make sure to read the fine print on sites like FreeCreditReport.com as you will be charged a membership fee after three months.  It is likely you were not aware of this when you received your “free” credit report.

2. Do some research – If you are OCD about things like I am, you will graph trends and dissect the average mortgage rate over the last 40 years by the affordability index and multiply that times the REO (over exagerating  a bit here).  If you are like MOST homeowners, you just want a glimpse of where rates are and an idea of where they are headed.  An invaluable website for all rates is Bankrate.com.  You can find pretty much all the information you could possibly need on rates at BankRate.  Another website I use often is the Housing Tracker.  This gives you a glimpse of asking prices and inventory levels over the last several years.  Charts help portray the direction of a specific market.  Obviously, if you are in a market in which asking prices have plummeted and inventories have not, lenders truly need your money now!

3.  Know your financial leverage – In today’s mortgage market, lenders NEED your money.  If you do not think this is the case, then why have over 300 mortgage lenders imploded in the last two years?  Knowing that the lender needs your money, if you have a strong financial backing, you will DEFINITELY have some leverage when you walk into the mortgage lenders office.

4.  Be patient – In a society where will all want something as soon as possible, it might be smart to be patient.  Do not jump at the first offer that is made.  As discussed, the lenders need your money so they many be willing to make a better office if you walk out the door.  Tkae your time, sleep on the offer and make a sound decision rather then acting on impulse.

5.  Have FUN – For the first time in many of our adults lives, this is truly a buying market in the housing industry.  We now have leverage over the financial companies and can force things upon them.  Our parents and grandparents cannot say they had this opportunity.  Enjoy it and cherish these special times.

Use these tips and have fun in this buyers market; just make sure not to jump at your first impulse and be objective about this big financial decision.

Related Articles:

Average Mortgage Rates Tumble to 5%, What It Means for You

Refi Laboratory: A Common Man’s Pursuit of the Ultimate Mortgage

If You Think Mortgage Rates are Low Now, Wait Until You Read This

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Comments

4 Responses to “The Lazy Homeowner’s Way to Refinance”

  1. The Lazy Homeowner’s Way to Refinance
    December 28th, 2008 @ 6:24 pm

    [...] Random Feed wrote an interesting post today onHere’s a quick excerptRefinancing is a top issue that is on many homeowners minds. The problem is that it takes a lot of time and effort to refinance one’s home at a rate they are comfortable with. Below are four ways the lazy homeowner can make refinancing an easier process. 1. Know your credit score – Before you pick up the phone or step foot in a mortgage lenders office, make sure that you have a ballpark figure of your credit score. If you have a strong score of 720 or higher, you will have greater say in w [...]

  2. Wayde Mckelvy
    December 29th, 2008 @ 1:00 am

    You’re right that many folks are going to grab the lower rates. Whether folks are looking to refinance or get their first mortgage, the loans offered often have fine print that loan brokers will try to gloss over. Some loans will soar to much higher rates at the end of some period of time, 6 months, 12 months, 3 years. The average home buyer often thinks “I’ll worry about that when the time comes” but that can be a costly oversight. Watch out for loans that are “interest” only and also those that include a balloon payment.

  3. Subprime Blogger » Why Can’t I Get That Low Mortgage Rate Advertised?
    January 5th, 2009 @ 11:49 am

    [...] The Lazy Homeowner’s Way to Refinance [...]

  4. alex
    May 1st, 2009 @ 6:47 am

    Thanks for sharing. It is useful for me.

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