Mortgage Refinance Requirements & Costs

Because mortgage refinancing involves many of the same steps that you followed to get your current home mortgage, you may already know what to expect. You may, however, face a few additional steps and different types of expenses.

Mortgage Refinancing Required Information

Similar to the traditional mortgage process, a mortgage lender will require you to complete a home loan mortgage application. The mortgage application assesses your financial situation, credit history, the property value, the amount of home equity in your home, and other data.

The mortgage lender will require:

• verification of employment and income,
• information about debts and assets,
• account numbers and balances for savings, checking, and other financial accounts,
• a title search,
• a copy of the site survey, and
• an appraisal (in some cases an exterior-appraisal only).

Information about your present home mortgage will also be required, such as:

• current monthly payment,
• outstanding mortgage balance,
• status of property tax and home owners insurance payments, and
• the mortgage lender’s contact information (if you’re not refinancing through your original mortgage lender).

Mortgage Refinancing-Time and Costs

Some of the types of mortgage fees you paid during the closing on your original home mortgage will be charged during a mortgage refinance. These may include an application fee, title search and title insurance fees, appraisal costs, loan origination fee, discount points, prepayment penalties, and if applicable, legal service fees.

Sometimes a new appraisal will not be necessary, and some home mortgage refinancing fees and closing costs may be waived. If you refinance through your original mortgage lender, some mortgage refinancing fees can be negotiated -- such as title search, application fee, and credit report review. Sometimes, a new mortgage lender may also be willing to negotiate those fees. And, in some cases, a mortgage lender may offer "no-cost" refinancing, which means most of the up-front processing and closing fees are not required. In these cases, however, the mortgage lender will typically charge a higher mortgage interest rate.

Home refinancing with a mortgage lender who uses automated underwriting may result in faster processing time. Automated underwriting allows a mortgage lender to provide a loan approval decision in minutes. Most FreeLoanComparison.com lender partners use automated underwriting(AU), which can save you time and money. For example, with AU, your mortgage lender may not need to order an appraisal on your property and may require fewer pieces of information from you at your loan application.

For more helpful mortgage tips on mortgage refinancing, home mortgages, reverse mortgages or a home equity line of credit, contact FreeLoanComparison.com today!

Last update: November 14, 2008