Mortgage Loan rates are much lower than what they use to be in recent years. So if you recently bought a home and currently have a higher rate than what’s available now, it’s time to refinance your mortgage. Stop paying too much for your mortgage. Even if your present rate is only higher by 1 percent compared to current market rate, don’t risk the chance of missing out on saving thousands of dollars.

By refinancing, you can reduce your rate, change the terms of your loan and ultimately reduce your monthly payments. Through refinancing, you can borrow more than what you owe, use the money for home improvements, room additions, consolidate debt or keep the money in your pocket. Why would switching from an ARM to a 30 year fixed be beneficial to you? Get a free quote and find out the advantages of different loan terms and how much you can potentially save by reducing your mortgage rate. This special report is designed to help you avoid nine common mistakes. Remember that the right lender can help you make good, sound business decisions based on your personal financial situation.

1. Fixed or Adjustable Rate Mortgage (ARM) - Conventional thinking is that fixed is always better and while this is sometimes true, it is not always the case. The key here is to ask, “How long am I going to live at this property?” An ARM can actually be a better choice if you are going to be in the home for a short time. The average for how long a first time homebuyer keeps their mortgage is less than four years. In general, the longer you plan on staying in your home, the better a fixed rate mortgage will suit your needs.
2. Donâ?Tt try to bottom out the market - Deciding when to lock in to a mortgage rate can be difficult. Many people will float, trying to guess when rates have hit bottom. Unfortunately, a lot of times they will wait too long and end up with a much higher interest rate. There is nothing wrong with floating but keep a close eye on economic indicators. Your daily newspaper or even the nightly news can be an excellent source of information on the latest interest rate activity. As closing nears, it might be worth locking in.
3. Negotiate problems prior to closing â?” Its common for a problem to arise before closing. Waiting until closing will rarely be in your best interest. For instance, if you accept $400 at closing in lieu of the seller making a repair and after closing you find that the repair will actually cost $600, youâ?Tve obviously made a poor decision. Whether the builder agreed to add an item and has not or the seller has made a repair that is not acceptable to you, discussing a solution prior to closing will give both parties time to analyze and determine options.
4. Be prepared for closing costs â?” In addition to the down payment, you will be required to pay fees and other closing costs at the time of the final transaction. Closing costs typically range from 2 percent to 6 percent but will be dependent upon your situation. Lenders must provide you with a “Good Faith Estimate.” The “Good Faith Estimate” will breakdown all costs so that you may know what to expect at closing.
5. Close at the end of the month â?” When making a mortgage payment, you will be paying interest that has accrued from the previous month. Upon closing however, your lender will charge you prepaid interest for the date the loan is recorded through the end of that month. Therefore, one way to lower your closing costs is to close in the latter part of the month. This will lower the amount of prepaid interest that you must pay.
6. Look out for hidden fees — Check for certain miscellaneous fees such as inspection, notary, and document preparation. These types of fees can mean hundreds of dollars in closing costs. Remember that this is your money at stake. Never should you be afraid to ask for explanations of fees you are being charged.

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Originally Posted on 8/4/2005 10:05:24 AM
Content source: http://clientshop.blogware.com/blog/_archives/2005/7/5/997383.html