5 Tips for Getting the Best Mortgage Refinance Rates

Posted by Andy Masaki

When the time comes to refinance a mortgage, the goal is to get the best deal possible. While talking with various lenders is a start, there are more calculated ways to seek out the best rates and ensure that you qualify for them. Here are three tips for getting the best rate possible on a mortgage refinance.

Determine If This is a Good Financial Move

Seeing rates on the Internet or hearing someone on the news mention the drastic drop in rates is enough to get the average consumer interested in a home refinance. Unfortunately, refinancing isn’t for everyone. There are some consumers that should stick with the loan they have instead of refinancing. The first step is taking a closer look at the mortgage and the possible savings that a refinance would offer. The savings should be considerable before going ahead with the plan.

Check Your Credit

There are lots of ways to get a better rate on a mortgage refinance. One of the most important ways you can influence the rate you’re offered is checking on your credit and making sure that you have the best possible score. If there are things that need to be cleared up or some of your bills have been late recently, it might make more sense to get your credit score straight before applying for a refinance.

Stop Opening More Lines of Credit

Once you decide that you want to refinance, don’t open up any more lines of credit. Despite the fact that you already have a mortgage, you will still need to go through the preapproval and approval process all over again. This means that your debt-to-income ratio will be examined and your overall credit score will be used to determine whether a lender is interested in dealing with you. Don’t apply for new credit cards or take out new loans until the process is complete.

Consult at Least Three Lenders

According to MSN, experts suggest that consumers do a little bit of research first. Before going ahead with a refinance, make sure to speak to at least three different lenders to get more information.

Not all mortgage refinance rates are going to be the same. Some lenders may have special incentives or be able to offer you more of a deal than others. Shopping around gives you the opportunity to really see what is out there and compare each offer to the others. If one lender comes out with a better overall deal, even if the rate is slightly higher, it still might be the better option.

Don’t Wait Too Long

Once you decide to refinance, don’t wait too long. It is easy to gather up the offers, take some time to think about them and then push off the decision for several weeks. People often miss out on great opportunities because they don’t take advantage of them when they are offered. While no one wants to rush into a decision, it is important to look at the options, choose the best one and then go for it.