1. Not shopping around for the best rates:
2. Focusing only on the interest rate:
Although the interest rate is the main factor in deciding what your mortgage payments would be, concentrating only on the interest rate will not do. Closing costs are also to be taken into consideration. Closing costs vary from lender to lender, and a low rate may seem tempting apparently but it may be a come-on to a loan with high fees. Be sure that you inquire about the loan origination fees, points, and all other fees before applying for a loan.
3. Signing loan documents without properly reviewing them:
Check all the loan documents before you sign them. Do your homework before coming to the closing. You won’t get enough time to review those papers while you calculate the closing costs. So make it a point to review them in advance. Make your mortgage refinancing a success by checking all your documents before you add your signature to them.
4. High prepayment costs:
There are some loans that come with a prepayment penalty. You should find out how long this payment penalty period exists. If you’ve already planned to leave your house within a year and your prepayment penalty is for 2 years, you will have to pay the prepayment penalty in the future. Thus, make sure that you check such costs so that you do not have to pay them in the future.
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