How does an online tool known as a Refinance Title Calculator help in a refinancing deal?
When it comes to refinancing a mortgage, homeowners who force lenders to compete for their business are likely to get a better refinance deal. How good a deal can be computed by using a Refinance Title Calculator.
Fees and Charges
First let’s look at fees and charges associated with a refinance: Costs to refinance a current mortgage will vary according to the loan amount, choice of lender, credit score and interest rate. Then there are the closing costs that include lender fees, escrow and title fees, insurance and taxes, optional points, appraisal and credit fees. The owner may choose to finance their fees and closing
costs by adding them to their current mortgage, if there is enough equity in the home to do so.
By taking a higher interest rate, a homeowner with a no-cost mortgage can avoid additional fees (or having to find cash to pay the closing costs). Excluding interest, taxes and insurance, all one-time closing costs can be covered by the mortgage originator, utilizing their rebate from the lender who funds the mortgage.
Both the Owner Title Insurance Policy and Lender Title Insuranc Policy will be covered under escrow and title fees and the policies will protect both parties, since the policies aren't issued until a comprehensive
search reveals there are no outstanding defects to the title.
Since, during refinancing, a new mortgage is created, a new title policy is required, but many title companies can offer a reduction in title policy fees and escrow fees for a refinance transaction.
The service fees charged by the title company for acting the role of an independent third party and helping get the deal closed are called escrow fees and there are other miscellaneous frees for copying and mail, drawing and courier, mortgage document notarization fees, notary fees and County Recorder fees to record the deed.
Flat fees charged by the lender to process a mortgage include document preparation, administration and finding fees, underwriting and processing fees. Additional lending fees include wire, flood certifications and tax services. Homeowners may expect nearly every lender to charge these fees, which should total under $1,000.
Points are origination and discount fees. The latter are actually prepaid interest that a homeowner pays up front to buy down the mortgage’s interest rate and origination fees are used to compensate a mortgage originator during the transaction.
Appraisal fees are based on how much an appraiser charges to inspect a property and credit fees are used to review the homeowners’ credit report. If homeowner’s insurance is required by the lender during a refinance it is usually just the replacement cost coverage.
Taxes, during a refinance, may be required to be prepaid into escrow.
Taking all these charges and fees into account should give a homeowner a clearer picture if refinancing is an attractive option for them. Making use of a Refinance Title Calculator, such as the one at www.mortgagecalculator.org will bring the picture into even sharper focus.