No-closing-cost loans make it possible for homeowners to reduce their monthly mortgage payments and realize savings immediately. Frequently the final speed on a no-closing cost loan is higher than a loan with closing costs. If the homeowner doesn’t require the best speed available and will not be in the home for more than a couple of years, no-cost refinances can be the most lucrative choice. Make sure that you ask a no-closing-cost loan when obtaining quotes.
Contact three to four creditors and ask no-closing-cost refinance quotes. Telephone your current mortgage company for a quote; it might have additional options available as you’re already a customer. Ask people you trust for a referral; in case referrals are not available, check your state government’s website to see whether a list of state-licensed mortgage creditors is available to the general public. Use the available list to contact lenders locally for quotes.
Request the creditors provide you with a good faith estimate (GFE). The federal Real Estate Settlement Procedure Act requires all mortgage lenders to utilize a standardized GFE when providing quotes. The GFE is a three-page document that outlines the specifics of this proposed loan.
Compare the quotes with one another using the section labeled “Utilizing the purchasing chart” on page three of the GFE. If the creditors have complied with your request for a no-closing-cost mortgage, the only thing to compare will be the interest rate. Choose the lender with the lowest interest rate. Take notice if more than 1 creditor offers the lowest interest rate.
Negotiate with all the creditors. Telephone the creditors who quoted you that the second or third highest speed and ask them to beat the best speed. If more than 1 lender offered the best rate, call all them and require them to decrease the rate to make your business. Make sure that all new quotes provided will also be available on a GFE. Once 1 company provides an interest rate that other businesses cannot beat, schedule an appointment to apply for the loan.
Ask your mortgage lender what files are required from you for the loan. Gather those files and take them to the application appointment. Work with your creditor because it obtains loan approval. Many times the lending institution will need additional documentation and explanations from you to describe your financial picture. Provide these items to your creditor as quickly as possible.