Surest and Best Way to Refinance Your Mortgage

by Steve in Florida and by Shirrley in Georgia

Ask Kate for the surest and best way to refinance a mortgage: Steve from Florida wonders where to find an independent review for his loan paperwork before his mortgage closes. He isn't sure if he is part of the HARP program and asks what crucial information he could be missing.

Shirrley from Georgia is frustrated with her lender who after leaving the United States, quit refinancing mortgages already in their portfolio.

How Can I Get a Refi Loan Review?

By Steve from Florida

Hi Kate,

We will be closing on refi loan soon (30 year fixed, 4.75%) from Quicken Loans.

I'm pretty clueless. Is there a professional service I can consult to have the loan reviewed before the closing?

If so, what would I Google on? Not finding anything under 'mortgage loan review' and similar.

Also, how can I tell if it's part of the HARP refinance program? How can I tell if it's backed by Fannie Mae or Freddie Mac? And other crucial stuff . . .

Thanks, Steve

Ask Kate answers: How Can I Get a Refi Loan Review?

Hi Steve,

Do you owe more on your mortgage than the home's current value?

Is the loan that you are refinancing backed by Fannie Mae or Freddie Mac? (Go here for help determining if you have a Fannie Mae or Freddie Mac mortgage.)

If you answered yes to both questions, you can be pretty sure that your new mortgage is part of the HARP refinance program which means it is backed by Fannie or Freddie.

But to be certain, read through the note for details. You should also be able to ask your loan originator this question. Don't settle for a verbal answer. Make sure it is shown to you in the paperwork that you will be signing and dating.

Perhaps you could hire a real estate attorney to review the paperwork although this might be a bit pricey. Regardless, I highly recommend educating yourself. I break down the basics into 3 categories...

1. Good Faith Estimates and Mortgage Rate Lock Agreements


2. Promissory Notes, Adjustable Rate Riders, and Prepayment Penalties


3. 3-Day Right of Rescission

Good Faith Estimates and Mortgage Rate Lock Agreements

Learn how to compare mortgage rates to closing costs by understanding a Good Faith Estimate. This is the best way to avoid deceptive fees!

Secondly, make sure the mortgage rate is the same as the one you locked. There's more on locking-in at Nitty Gritty Mortgage Rate Lock Agreement.

Promissory Notes, Adjustable Rate Riders, and Prepayment Penalties

Peruse riders to the promissory note that allow interest rate adjustments. Watch out for inferior loan terms allowing balloon payments or early prepayment penalties.

Read more about Promissory Notes, Adjustable Rate Riders, and Prepayment Penalties here.

Never feel rushed while you sign your loan documents. Read, read, read! Ask questions and again, ask to have the answer pointed out in your loan documents.

Use Your 3-Day Right of Rescission

Here is my last tip! As long as the property being refinanced is your primary residence, you should have a 3-day right of rescission during which you can review the terms of your mortgage and halt the funding, if necessary.

Click here for more information on the 3-Day Right of Rescission.

Best wishes,

How Do I Refinance a Mortgage After My Lender Closes Its Doors

By Shirrley in Dublin, Georgia

Kate,

I currently have a mortgage with a company that closed all their offices here in the USA.

They no longer are in the mortgage business and they will not refinance any existing loans.

They are just servicers collecting high interest rates on primary residence mortgages.

You can request a hardship loan for six months if you qualify. But I would like to refinance and get a much lower rate.

The mortgage is not with a Fannie Mae or Freddie Mac lender. Do any of the conventional lenders have any programs that can help homeowners whose mortgages are not with Fannie Mae or Freddie Mac?

Ask Kate answers: How Do I Refinance a Mortgage After Lender Leaves USA

Hi Shirrley,

You did not mention if your mortgage is underwater. If the value of your home is greater than the mortgage balance, you are not restricted to your current servicer for refinancing.

Sidebar: Underwater homeowners with a Fannie Mae or Freddie Mac mortgage also have the option, in most cases, to shop lenders for their best deals.

However, without a Fannie Mae or Freddie Mac loan, you will be hard-pressed to find a lender willing to refinance an underwater mortgage. This is because houses without equity are considered a financial risk.

I suggest calling the Attorney General of Georgia's office and ask what recourse you might have since the lender has left the US and offers no mortgage refinance services. The phone number is 800-436-7442.

Best wishes,

Ask Kate about Your Mortgage

Anyone can ask Kate a question or add a comment at the bottom of this page.

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