Refinance home loan: Costs discovered
Many individuals who refinance home loan can be surprised that as they go through the process, they discovered the many different costs associated with it. One reason why is because they tend to forget that to refinance home loan is like reliving your first loan application.
Refinance Home Loan Costs
You may not be aware of this fact, but when you are dealing with home loan refinancing costs, you are obligated to pay at least three percent of the remaining balance of the principal.
This figure might sound like it's a lot, however, it actually is even less that what you paid for when you first acquired your home loan – it's just like experiencing the loan application again.
Indeed there are many loan fees that you will be required to pay. Such fees actually vary from state to state. There are also differences when dealing from one lender to another. Do you know that some of the home loan fees are just 15 to 20 dollars in one area, while in a different location, they can be as high as 100 dollars?
The most common refinance home loan fees are the following:
1. Appraisal fee
2. Application fee
3. Review fees
4. Home owner's hazard insurance
Additional Fees That You Should Be Aware About
Apart from these fees, you will likewise be paying for other additional fees such as home inspection fees, title insurance and title search, loan origination fees and mortgage insurance. Once you sum up all these fees, you are definitely looking at a figure that will run up to a thousand dollars or more. However the true amount will be dependent on the type of refinance home loan that you will apply for. It also significantly depends on the loan principal amount left.
One important fee that many people ignore when to refinance home loan are the pre payment penalties, which are associated when calculating the home refinance cost and expenses.
There are instances when you are fortunately not to be burdened with such fees. However, there are actually many loans that have these pre payment penalties written in order for them to receive payment once you decide that you want to pay off the home loan sooner or if you have opted to refinance home loan.
Can Certain Fees Be Waived?
Sometimes some of the fees might be waived by your lending agent or company; it is just a matter of requesting them for such favor. Indeed, there are many borrowers who are not aware of the fact that lenders are more than willing to waiving loan fees, or at least reduce them significantly, in order to accommodate more borrowers by making refinance home loan costs more affordable.