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Always get 2 good-faith estimates

BOB KIEBER
special to the daily

With mortgage interest rates close to record lows I am seeing a record number of owners looking to refinance. These home owners have short term Adjustable Rate Mortgages that are set to adjust in the not too distant future or they have a thirty year fixed rate mortgage that is one half percent or more higher than current interest rates. So now is the time to at least look around to see if a refinance is cost effective.

The first thing you need to look at is yourself. Are you planning to be in your current home for one year, five years, ten years? This is a very important question to ask yourself so we can determine if refinancing is cost effective. If your cost to refinance takes twenty months to break even and you plan to sell the home in the next six months I would suggest you keep your current mortgage.

So let’s say that you have determined, based upon today’s information that you plan to stay in this home for ten years. Your first step has now been taken in the refinance process.

The next step is almost as simple. Gather up your last mortgage statement or statements and your last paystub. Step two has now been completed.

The third step takes some real effort now. Pick up the phone and call me and say that you what to look at refinancing. Pretty difficult.

At this point in time I will ask a lot of questions. I want to know if you have determined how long you plan to stay in this home. I will ask you the current mortgage balance and how much you think your home is worth in the current marketplace. And I will ask you a couple questions on your income.

Then ask me for a Good Faith Estimate. This is a very important step as this form will disclose to you all the various fees that you will have to pay to get the refinance. It will also disclose the interest rate and mortgage program.

So far so good?

Now after you speak with me call another mortgage lender and go thru the same steps with them. And makes sure that you get the Good Faith Estimate in writing. That way you can compare apples to apples.

At this time you have two Good Faith Estimates in front of you. If you have questions do not be afraid to ask the lender for an explanation. You deserve a full and complete explanation.

From this point you should be able to determine the best deal for you. And by having two Good Faith Estimates you can sleep at night knowing that you did your homework and got a great deal.

Bob Kieber can be reached at (970) 262-1199 or at rkieber@comcast.net. He is a local mortgage lender and principal of Resort Lending.


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