If you’re thinking about refinancing your mortgage, this could be a good way to save money on interest rates; however there are a few things you should consider before you commit to new loan.
Firstly, you should check your credit report to ensure that there are no discrepancies there. Lenders will want to check your credit history before they let you refinance, so it’s a good idea to check it through yourself first and make sure that you haven’t missed any payments on your current mortgage, as this might reflect negatively on your application.
Next, you should monitor the lock-in period on the loan you are considering. To avoid higher payments on your loan’s interest rate when the lock-in period expires, try to refinance the loan at least four to six months before the lock-in expiry date.
Finally, pay attention to the fees. The bank or lender will typically charge you legal and processing fees to refinance the loan, depending on the amount and term period of the loan. Some lenders may offer lower fees than others, so it is important to comparison shop before you sign the dotted line.