Mortgage : Home Loans : Refinance : Home Equity Loans

By Louie Latour

If you are refinancing your mortgage there are a number of fees and penalties you want to avoid paying. Many homeowners focus only on finding the best interest rate when refinancing their mortgage loans. These homeowners often overpay for everything else on their loans and take out mortgages with prepayment penalties. Here are several tips to help you avoid overpaying for your new mortgage with a prepayment penalty.

Mortgage lenders include prepayment penalties in their loan contracts to discourage borrowers from refinancing the loan. If you sell your home or refinance before the penalty expires you will be required to pay a fee. Prepayment penalties can be quite expensive; it is common for lenders to charge up to six months worth of interest on 85% of the original loan balance. If you finance your mortgage with a bad credit you can expect more stringent prepayment penalties included with your loan.

There are ways to avoid prepayment penalties, even if you have poor credit. The first thing you should check before mortgage refinancing is if your existing mortgage includes this prepayment penalty. If your current mortgage does not have a penalty or the penalty has already expired you are clear to begin mortgage refinancing. If your prepayment penalty has not expired, you can try negotiating with your current lender to see if they will discount or waive the penalty for you. If the existing mortgage lender will not negotiate you will be required to pay the penalty to refinance your loan.

When mortgage refinancing, most items on the loan contract are subject to negotiation. If you haven

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For additional Mortgage Refinancing information
and resources visit Mortgage Refinancing.
(http://www.refinance-refinance.net)
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This entry was posted on Thursday, November 9th, 2006 at 3:18 am and is filed under Refinance. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.