Today's Mortgage Rates

When brokers negotiate with borrowers, they will sometimes employ tricks that effectively raise the price of their services, a cost which must be borne by the borrower.  There are dozens of such tricks, but the result of each is the same: the borrower spends more money while obtaining a mortgage.  It is very difficult for the average borrower to avoid such tricks, as the borrower can rarely match wits with the broker in matters concerning mortgages and real estate.  Therefore, it is a simple fact that many borrowers pay a larger broker fee than they need to.

How is it possible to avoid this situation?  Some individuals have tried making brokers compete against one another in order to get a lower price on broker’s fees that are an essential part of every mortgage.  However, as brokers do not usually compete with one another on the same loan, the borrower in this situation will be at a few disadvantages: a resentful broker may try to manipulate the closing fees in order to rack up the price, and the broker may not be willing to go the extra mile if there are any serious problems with the mortgage.

A better solution would be to insist upon knowing the exact broker’s fee before the work begins.  That way, the broker will be forced to bypass any and all tricks so that the quoted price is maintained (It should be noted that the price of the mortgage cannot be set beforehand, only the broker’s fees).  Another option is to check out the list of the Upfront Mortgage Brokers, a group of brokers who quote a fee for their services upfront.  By utilizing a broker in this group, the borrower will avoid tricks, unnecessary fees, and probably a lot of frustration.

Take some time to consider the above situations or identify the situation that best applies to you.  Having a good understanding of your reasons for a refinance will aid you in choosing the best home lender and the best mortgage option for you. Refinancing allows for you to change your type of loan, allowing for different options.

Now that you have identified the reason for your refinance, the next step is to learn about the different types of loans available to you.  The following are some of the loans available in New Hampshire:

- Fixed Rate Mortgage – A Fixed Rate Mortgage allows for interest rate to remain fixed.  This is a good type of loan to consider if you are planning to stay in your home for an extended length of time.

- Adjustable Rate Mortgage – An Adjustable Rate Mortgage (or ARM) allows for the interest rate to adjust to the changes in the market.  An Adjustable Rate Mortgage is beneficial if you are staying in your home for only a short period of time.

- Interest Only Loan – An Interest Only Loan allows for a larger loan that might not normally fit into a person’s budget.  Monthly payments will rise after the interest payment period is over.

- Libor Loan – A Libor loan is similar to an ARM loan in that the interest rates fluctuate with the market.  However, in contrast to an ARM, the Libor loan is typically more aggressive in the interest rate offered.

Once you have identified a loan that you think best fits your refinance situation, it is time to educate yourself on New Hampshire law.  Knowing the different laws will aid you when finding a home lender.  Do you know that created a committee in 2004 whose sole purpose is to protect home purchasing consumers?  This is very beneficial to you as you search for your home lender.  The following are some of the laws in New Hampshire for you to further research:

- Broker Licensing
- Foreclosure

Now that you have identified your refinancing reason, type of loan you are most interested in, and the types of loan laws in New Hampshire, you are ready to find your home lender.  Remember to research the home lenders available in New Hampshire.  Good luck!

Once you make the decision to refinance your current mortgage you should shop around for the lowest interest rate possible.  Your interest rate can make a huge difference in your expendable income over time.  For instance if you take a $100,000 mortgage loan for 30 years at 10% your payment would be $877.57 per month not including any escrow money required by your lender for property taxes, home owners insurance or mortgage insurance.  If you take the same $100,000 loan for 30 years at 6% your payments would be $599.55 per month.  Over 30 years the lower interest rate would wind up saving you $100,087.20 in interest alone.  If you put that extra money away every month into a 4% savings you would have a healthy retirement account of around $187, 112.69 by the end of the 30 year period.  This is in a 4% savings without any risks.  If you put the money into more aggressive investments you could yield much larger returns.

This is why finding a low interest rate is so important for anyone refinancing a home to consider.  A small percentage difference in interest rates can make a huge difference over time.  The good news is that since you are refinancing your mortgage loan you are probably in a better situation to get a lower interest rate.  Because of all the time you spent paying your current mortgage loan you credit score goes up and with better credit and a good payment history you should be able to refinance into a mortgage loan that will save you money.