Now might be the time to refinance if…

your mortgage is under $200,000! Why is that? Well the amount of compensation a lender or mortgage broker can charge for a loan will change and this will determine which borrowers the lenders choose to work with and you just might not get the personal attention that you deserve!

What that means to you is that there are a few changes that really aren’t that favorable to you. One is that the lender is no longer allowed to give you a credit back on any of your “back end fees”, they will no longer be able to pay for appraisals, or credit you for any of your closing costs as they have in the past. Now, most big banks have already set the wheels in motion to cover their bases with these changes; however this really may hurt the smaller lenders, the mortgage brokers, and possibly the credit unions. What this will do is run their profit margin so thin, that they won’t be able to accept loans that are less than $XXX number of dollar, because they simply can’t make any money on your loan.

In addition to that, there will be an increased cost to you in the form of Mortgage Insurance. If you have less that 25% equity in your home the lender will more than likely require that you now have mortgage insurance. This will attribute to a significant increase in your monthly payment with no added benefit to you as the borrower. You may be thinking, that’s ok, I won’t need to have the Mortgage Insurance for very long – I have quite a bit of equity and I will just get rid of it shortly thereafter. In realty, the lenders are making it increasingly difficult for you to remove your PMI once it’s in place.

Bottom line, change is change, and the lenders will adapt. We don’t know how long it will take to work the bugs out and get through the turbulence.

What we do know is now is a great time to get out there and refinance if you haven’t already. Rates as of today are just under 5.000% on a 30 year fixed with loan limits up to $729,750. Check with your lender for specific rates and terms along with the appropriate APR.

If you or someone you know are looking for an introduction to a lender, feel comfortable giving me a call or sending me an email and feel good knowing that you, your family, friends, neighbors and coworkers will the help needed from someone you can trust. I will look forward to hearing from you, and happy refinancing!