Tag Archives: mortgage

Housing For The Holidays

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With Thanksgiving, Black Friday, and Cyber Monday under our belts, the holiday season is officially in full swing and we couldn’t be happier about it! 2016 has been a whirlwind of a year, and on behalf of everyone at Alpha Mortgage, we are glad that we were able to make so many dream home ambitions a reality. So what’s going on in the housing world? We’re here to update you on what’s happening now, what to expect, and the best gifts to give your home the extra love it deserves this holiday season.

What’s happening- A Recap

As many of you know, mortgage rates have stayed relatively low for the past few years, and the market has favored sellers. Why? Recently, the housing market has been in high demand with very tight supply across the nation, which led to a new peak in home prices nationally in September 2016, according to CNBC. You know the deal- sellers can list as-is, and usually, drive up the price of the sale due to multiple offers because demand is so high.

Here’s the update- in early November 2016, mortgage rates raised for the first time since January from about 3.94 to close to 4.10. Why? A little thing called the United States of America’s Presidential Election. Don’t panic, the rates were the same at the beginning of 2016.

The FHFA also raised their conforming loan limits from $417,000 (which has been in place since 20016), to $424,100 which will be effective January 1st, 2017, and that means that house prices are going up enough to qualifies you to borrow more money starting in the new year.

Oh, and tiny homes are still a thing.

What to Expect

A holiday housing freeze- it is normal for sales and prices of homes to drop in the Winter months, following in suit of dropping temperatures, as well as increased spending on other things (hello holiday shopping). Longtime Realtor Kim McElroy explains to Realtor.com that “Typically, sales do slow down somewhat in the winter just because the focus is on the holidays and a lot of people do take their houses off the market,” says longtime Montgomery, AL-based Realtor Kim McElroy of Keller Williams Realty. “But I see a spike of interest and calls right after the holidays.”

Longforecast predicts that the 30-year mortgage rate for December 2016 will increase by 1.41% averaging a rate of 4.33, and also predict that January 2017’s average rate will be 4.28 or a -1.15% from December.

Expect the housing market to swing in the favor of buyers in the next 2-3 years due to increased supply from builders taking advantage of the lack of homes available.

Top 5 gifts under $250 to make your house a home

  1. Satechi iPhone Charging Stand – $25- Amazon- This is a great stocking stuffer for anyone who Facetimes, Cooks and uses their phone for recipes, or multitasks in general! It comes in 4 different finishes that match each phone color.

81ls-p3a3ul_sl1500_2. Ring Video Doorbell Pro– $249 – Amazon- See, hear, and speak to anyone at your door from your smartphone, tablet, or PC and get instant alerts when visitors press the doorbell.

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  1. Nest – Learning Home Thermostat– $249 – Amazon – Nest automatically adapts to your life, as well as when the seasons change. All you have to do is use it for a week, and it programs itself!61kyuqogkl-_sl1000_
  2. August Smart Lock– $229 – Amazon- Use your smartphone to lock, unlock, and monitor traffic on your doors.

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  1. Kohler Moxie Showerhead and Wireless Speaker– $92.50 – Amazon -Stream music playlists, news, and other audio in the shower.

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TRID – A Year Later

On October 3rd 2015, history was made in the mortgage industry when the TRID Rule, or the “Know Before You Owe” Rule was implemented in the United States. TRID was created in order to bridge the gap of transparency between borrowers, regulators, and lenders through more consumer-friendly documents and additional time restraints in the lending process with the hope of creating a more informed, and therefore better protected consumer. In the two years leading up to the implementation of TRID, those in the lending industry feared that additional paperwork and time would deter potential buyers. Once TRID was implemented, there were a few hiccups in the road, but the mortgage industry has been changed forever.

With a year of the implementation of TRID officially under America’s belt, we want to take a look back on the up’s, down’s, and still-to-come’s.

THE TRID TRAIN, A TIMELINE:

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November 2013: TRID unveiled to the lending industry with the proposed roll-out date to take place August 1st 2015. Cue industry-wide panic attacks due to the copious amounts of work they will have to do in order to adhere to the new rule (think technology and work process overhauls).

November 2013- June 2015: Everyone freaks out about the implementation of TRID, concurrent with an “administrative error” prompting the CFPB to change the start date to October 1st, 2015.

June 24th 2015-  A proposed amendment to TRID is released where the official start date of the “Know Before You Owe” rule will be October 3, 2015.

October 3, 2015- TRID goes into effect, and companies are mandated to comply. Many express concern and complaints that the CFPB is vague in some sections of TRID and the lack of guidance offered in the following months.

January 2016- Ellie Mae’s Origination Insight Report shows that total time to close has reached a high of 51 days, an indicator that the 6 days added in the process were being added to the total time instead of integrated in. Lending companies continue to complain about vagueness and lack of education from the CFPB regarding TRID.

July, 2016- The CFPB responds to concerns by lending companies and other businesses impacted by TRID and put some new changes into place regarding the secondary market to better help and inform lenders. The proposed changes include: tolerances for the total of payments, expanding the number of housing assistance loans that would qualify for exemptions, including cooperatives in the rule, and clarifying how a creditor could provide separate disclosure forms to the consumer and the seller.

August 2016- NAR surveyed 2,500 REALTORS to get their perspective of how the TRID rule was working which revealed that the majority saw no changes through the implementation of the rule.

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TRID IN 2017

While there were a few up’s, down’s, and hiccups in the past year for the lending industry (as expected with any major industry overhaul), it is apparent that TRID has been a mostly beneficial and much needed industry update for the consumer. As Pete Mills from the Mortgage Bankers Association stated, “TRID was a massive undertaking from a systems and business processes standpoint,” Although many anticipated the rule would significantly disrupt the closing process for consumers, the impact of TRID on consumers was mitigated because lenders and other participants in the closing process dutifully prepared for the final rule.”

Many lending companies are still making adjustments in their strategy with the implementation of the new rules, but with a year of adhering to TRID under their belt, lending companies are now analyzing ways to better streamline processes and resources to better serve their clients and integrate the additional 6 days in the process instead of adding them. Ready to own the house of your dreams? We’re here to help you from the beginning steps of your planning period all the way until you step through the doors of your new home. Contact us today at Alpha Mortgage!

 

Is the HECM For Purchase Program for you?

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You’re nearing retirement and looking for your forever home. You’re also looking to increase your well-being and security. You’ve heard about the Home Equity Conversion Mortgage (or HECM reverse mortgage) but wonder, “is it too good to be true?”. We’re here to tell you that the H4P isn’t too good to be true – it’s TRUE!

What is H4P?

The H4P mortgage allows homebuyers to receive funds from their lenders to finance approximately 50-60% of the purchase price of their new home. They are then freed from having to make regular payments after purchase, although they will be responsible for ongoing property taxes, homeowner’s insurance and home maintenance. Repayment is not necessary until the last surviving homeowner is no longer living in the home as their primary residence – either from selling or vacating the property or passing away.

So what’s the catch? You must be eligible for a federally insured H4P reverse mortgage. This includes being 62+ years old, be able to make a sizable down payment and finance the rest. Here are some further requirements needed to qualify for this safe program

  • A financial assessment to determine suitability.
  • Reside in the home for more than 6 months of each year.
  • Participate in a homeownership counseling session.
  • No minimum credit score required.
  • Federal debt including back taxes must be paid.
  • H4P is a first mortgage on title at time of closing.

Why H4P?

H4P provides you with the financial security you’re looking for in retirement. It provides flexibility, with NO monthly payments required. This will allow you to increase your reserve funds and liquidity. H4P also protects your heirs and is FHA insured, giving you peace of mind!
The amount of funds available will depend on your purchase price, age and interest rate. Use this calculator for an estimate of what you would qualify for and then give us a call! We’d love to inform, educate and pre-approve you as an H4P Buyer and start giving you the peace of mind you deserve.

August Update

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One of the hottest months of the year in Wilmington, NC is almost over, but the housing market is still on fire! According to recent NC Regional MLS statistics, home sales in New Hanover, Brunswick, and Pender counties combined have seen an 18% increase in home sales compared to last July’s home sales, and the median price of homes dropped about 3%. Similarly, Fannie Mae recently announced that it will maintain it’s forecast for 2016’s GDP at the same 1.8 percent forecasted in July after the second quarter growth was more than 1 point lower than predicted. So why didn’t America hit the predicted mark? According to the source, there was slowed growth in residential, non-residential, government and inventory investment in August. Fannie Mae is confident that August and September’s results will be different.

Now Trending: Roof Decks 

What is one of the most popular trends we’ve seen this summer with real estate development? Rooftop decks in urban areas. As demand for rentals rises and space for outdoor yards decreases in more heavily populated areas, roof decks have become a very popular and sought out addition for renters and those searching for their next purchase. Not only do they provide tenants with a private area to enjoy the sunshine, but they are also usually combined with luxurious amenities like pools, incredible views, fire pits, grills, and most importantly of all- fresh air that many millennials look for when searching for a space to inhabit. So what’s to come with this trend? Expect it to stay for a while. We predict that rooftop decks will become even more popular and expected in urban areas. We also predict to see the trend start popping up in areas that have landscaping for added value.

8 Reasons to Move to Wilmington, NC

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There’s never been a better time to relocate to ILM and its surrounding beaches. Between the bustling downtown river walk scene, the breathtaking beaches, the strong and connected community, as well as and the incredible year-round climate – Wilmington and its surrounding beaches welcomes and has something to offer everyone. What are your reasons to relocate?

  • Beaches- Once you visit North Carolina’s coast, your life is changed forever. Wrightsville Beach, Carolina Beach, Kure Beach, and beaches surrounding Wilmington, NC all offer spectacular views of the Atlantic paired with relaxed southern feel that makes anyone feel at home.
  • Downtown- The bustling downtown scene provides Wilmingtonians with a taste of the city life, with incredible shopping, dining, and nightlife opportunities for people of all ages to enjoy. Take this and combine it with downtown Wilmington’s rich history and landmarks, and you are armed with activities to partake in for years!
  • Community – Wilmington is home to both Cape Fear Community College and UNCW which gives locals opportunity to support the colleges in activities like Midnight madness, cheering on sports teams, and more! The tight-knit Wilmington community also provides many festivals downtown during the year, houses incredible music talent at spectacular venues like Greenfield Lake Amphitheater, and Azalea Fest itself is a great look into Wilmington’s amazing community!
  • Incredible Shopping + Dining- From shopping centers, to one-of-a kind boutiques, Wilmington is an amazing shopping hub for the south east. Whether you are strolling down shops in The Forum, browsing at boutiques downtown, or hitting up one of the local surf shops, ILM loves fashion. Another thing that Wilmington loves is great dining. Fresh seafood and breathtaking views make Wilmington a desirable place for any restaurant to open, but Wilmington houses some of the best restaurants in the state.
  • Proximity- Wilmington is close enough to bigger NC cities like Raleigh and Charlotte for an easy weekend trip, and just far enough to provide the perfect getaway from your friends. When you live in Wilmington, you’re never too far for friends and family to visit! (And once you move to the beach, they’ll want to visit all of the time!)
  • Furry Friends are always welcome- Wilmington loves your four-legged friends! From the loop at Wrightsville Beach, to the many dog parks in the city, your pets are an extension of your family in Wilmington and are even welcomed at many outdoor restaurants! Bring your pup on the dog-friendly beaches, or Java Dog Coffee shop downtown- ILM knows your pets should enjoy the beautiful city as much as you do!
  • Healthy Lifestyle- Wilmington loves being active. From stand up paddle boarding, or running clubs, to yoga on the pier, and everything in between, Wilmington loves supporting healthy and active lifestyles that take advantage of the amazing climate and views the town and surrounding beaches provide.
  • Home Affordability – Not only does Wilmington and its surrounding beaches have a steady real estate market, but the options are endless. Wilmington has high-end homes and communities as well as more affordable options that are still in incredible locations.

Your dream house is waiting for you in Wilmington, NC, and once you find it, Alpha Mortgage  will help you turn your dream house into a reality! Contact us today!

Finding your Dream Home – Where to Start

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Modern, brick, condo, ranch, one-of-a-kind, wood, restored, single-family, two-story, updated, beachfront, contemporary, finished- the options are endless. If you’re reading this blog, chances are you’re about to embark on one of the most exciting experiences of your life- purchasing a home! Exciting, and a bit intimidating for first-time buyers. The home-buying process is different for everyone, but luckily we are compiling the best tips, research, and helpful information in the next few blogs to make the process as easy as possible for you. So where do you start? After you get pre-approved to show that you are a serious buyer, determine how much house you can actually afford, and get in the mindset to find your dream home, you need to get organized.

Here are the basic, but extremely important questions you need to answer to get on the right track of finding and buying your dream home:

  • What basic features do you want for your house? This may seem like a no brainer, but list out exactly what kind of house you want to live in with as much detail as possible. Once you list the basic features out, prioritize what is most important.
    • Home style (condo, ranch, two-story, etc.)
    • Architecture style
    • Landscape Needs
    • Bedrooms
    • Baths
    • Square Footage
  • Where do you want to live? Once again, it’s important to list out the state, city, neighborhoods, and areas you would be comfortable living in. Location. Is. Everything.
  • Think a little into the future… buying a home is a big commitment. Will you be expanding your family with kids (extra rooms, school districts, etc), will you still be at your current job (commute), and how long do you plan on staying in the house?
  • Needs + Wants – here’s the fun part. Now that you have the basics covered, what do you NEED in a house (non-negotiables) and what do you want in a house? Get on Pinterest, check out what you like, and write down as much as you can!

Once you know what you want, it’s time to go out and find that home (or create it)! Keep an eye out for our next blogs leading you through the rest of the home-buying process! Happy hunting!

 

Reverse Mortgages

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It’s no surprise to anyone when we say that the aging process is a difficult thing to handle financially. There are a growing number of seniors planning to retire soon that are struggling to figure out how they will continue to pay their mortgage, maintain their standard of living, and pay medical bills, make home improvements, etc. for many reasons. For many seniors, their home is their largest and most lucrative cash asset- and could be the golden answer in helping to solve their financial worries post-retirement. Enter reverse mortgages. With the Federal Reserve keeping interest rates at an all-time low, reverse mortgages are presenting themselves to be extremely appealing for home-owners aged 62 and older that are looking to tap into their home equity. This is why on March 1st, 2016, Alpha Mortgage started offering North Carolinian’s and Virginian’s reverse mortgages within their scope of services.

So what is a Reverse Mortgage?

According to the HUD, “A reverse mortgage is a special type of home loan for homeowners 62-years or older that lets you convert a portion of the equity in your home into cash. Unlike a traditional home equity loan or second mortgage, HECM borrowers do not have to repay the HECM loan until the borrowers no longer use the home as their principal residence or fail to meet the obligations of the mortgage.” Borrowers are still responsible for property taxes, homeowner’s insurance, and property maintenance, but a reverse mortgage requires no monthly mortgage payments, and borrowers do not have to pay back their loan balance until they die, sell, or move.

Reverse mortgages are extremely complicated, but are great for seniors that are cash broke/ property rich, or cash rich/ property rich. The interest and fees on the reverse mortgage are added to your loan balance each month. Over time, your home equity will decrease as your loan balance grows. It’s the reverse of a traditional mortgage. The rising loan balance can eventually grow to exceed the value of the home, however, as the borrower (or the borrower’s estate) you do not have to repay any additional loan balance over the value of your home. Wade Pfau of The American College and McLean Asset Management, highlights what consumers need to know about repaying a reverse mortgage with tips such as “Prior to death, selling, or moiving, repayments can be made voluntarily at any point to help reduce future interest due and to allow for a larger line of credit to grow for subsequent use. There is no penalty for early repayment.” Read more of his tips here.

 Why would I get a reverse mortgage?

Reverse mortgages can be used strategically for many reasons. One of the biggest reasons that people take out a reverse mortgage is to stay in their current home without having to worry about their current mortgage payment.

Many people also open a line of credit with access to the cash over time to supplement social security, 401k, unexpected costs, or unexpected medical costs. People also use reverse mortgages to pay off existing mortgages, purchase a new home that better suits their needs with age, or as retirement income plans.

Sounds Great- Am I eligible?

To be eligible to receive a reverse mortgage, you must be at least 62 years of age or older, the property must be either 1-4 unit primary residences, condominiums, or manufactured homes that meet FHA’s requirements, homeowners must own the property as their primary residence and should have substantial equity in the home, borrowers must not owe any back debt to the government, borrowers are required to maintain the property in good condition to protect the value of the home, pay their taxes annually, and pay for their home owner’s insurance in accordance to HUD guidelines.

So there you have it! Reverse mortgages are great options for seniors who are interested in tapping into their home’s equity. As we mentioned earlier, reverse mortgages are excellent solutions for seniors, but can also be complicated, and aren’t for everyone. To educate yourself further about reverse mortgages, please visit our website devoted entirely to reverse mortgages here. If you’re ready to take out a reverse mortgage today, contact us, and let Alpha Mortgage ease in your retirement process.

2016 Housing Market Predictions

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New Year, New Housing Market? Not so much. According to many housing predictions, 2016 will bring a whole lot of the same to the table. But is this a bad thing? Absolutely not. While 2015 was known as the best year for housing since 2007 due to many factors such as increased employment rates, implementation of TRID, and more, 2016 will also continue the housing market’s upswing- just not as exponentially.  We’ll start to secure a ‘normal’ in 2016. Remember that word?!

Here are our 2016 Housing Predictions:

  1. Increased Interest Rates– The Federal Reserve is expected to continue to raise interest rates in the short term between now and 2016’s end, & homeowners who have adjustable-rate mortgages or home equity loans will most likely see their interest rate rise as a result.  Housing wire goes as far to say that Fixed-rate mortgages will also rise, perhaps up one-half of a percentage point between now and the end of 2016, reaching 4.5% for 30-year loans. Despite this increase in interest rates, mortgage rates will remain historically low. If the rates do start to rise in 2016, as gradually as they may, we could see slightly lower home-buying numbers next year. But these changes will be minimal due to the continued increase in economic expansion and employment numbers- meaning more people are becoming able to afford houses.
  2. Evolving Mortgage Process – Mortgages may be in reach for more Americans in 2016 due to legislation that would allow Fannie Mae and Freddie Mac to take into account new ways to measure creditworthiness like evaluating rental history and utility bill payments instead of just the FICO credit score. More loans may also allow buyers to include income from room rentals, etc. More lenders are continuing to ease credit standards, and don’t see that changing in the future.  This is good news for potential homebuyers!
  3. Increased Housing PricesReverse Mortgage Daily reports that appreciation in national home price indexes will likely continue at a faster pace than inflation, but grow more moderately than last year. The CoreLogic Home Price Index was up about 6% over the last 12 months, and CoreLogic anticipates a rise of 4-5% during 2016. This increase in home sales and prices can be attributed to the improved economy, which has brightened the financial outlook for many families and enhanced their overall financial security. Prices may be higher, but they will still be affordable to most.
  4. More first time buyers– We expect first-timers to make up a bigger portion of the market than they did this year. The reason is simple: The market will be more welcoming to them thanks to the aforementioned slowing price growth and easier access to loans. It is important to note that Millennials & Young Gen X’ers are expected make up the largest demographic of home buyers in 2016 because they have recovered from the financial crisis, are entering their prime professional years, as well as their prime family raising years.
  5. Rental Homes & Millennials– According to a recent analysis by the Federal Reserve, outstanding student loan debt now totals more than $1 trillion. Student loan debt can create additional hurdles for mortgage shoppers. It increases the borrower’s total debt-to-income ratio, which can cause problems during the underwriting and approval process, and excessive debt can lower a person’s credit score. All of this makes it harder for Millennials to qualify for home loans.  This is why we predict rental homes will continue to increase in popularity- Millennials simply can’t afford homes. Rental vacancy rates for both apartments and houses are at, or near, their lowest levels in 30 years, and rents are rising quicker than inflation.
  6. Smart Homes/ Housing Tech – Smart homes and houses with more technological features available at time of sale will continue to become more popular. Features like beacon technology, security tech, VR and more will make homes more appealing. Smart home features will start to be expected by consumers in 2016.

We can’t wait to help you own your dream home in 2016! On behalf of all of us from Alpha Mortgage, we wish you a very happy New Year!

 

“Know Before You Owe” – The Impacts of TRID on the HomeBuying Process

In our last blog , we described how The “Know before you Owe” mortgage initiative will promote the transparency of information associated with mortgage and lending procedures – thus helping borrowers better understand and prepare for their home financing decisions. TRID also referred to as the “TILA-RESPA” rule  (an acronym formed by combining the Truth in Lending Act or “TILA” and the Real Estate Settlement Procedures Act or “Respa”) aims to simplify the disclosure and loan-closing process for consumers and better prepare buyers for their mortgage transaction.

We’ve compiled a review of how TRID Impacts lenders and borrowers below – Enjoy!

1. New Loan Disclosure Forms & Closing Disclosure Forms

Lenders must now provide borrowers with new disclosure forms that explain the loan estimate and loan closing process in more detail. This new Loan Disclosure form combines the Good Faith Estimate Form and the Truth in Lending Disclosure form have been combined into a new, simpler Loan Estimate form.

TRID also mandates that mortgage firms can not charge credit report check fees until the borrower has received the loan estimate form and has indicated intent to proceed with said firm. These new regulations should make it easier for consumers to shop for and understand the interest rates associated with different loan packages from different firms. 

TRID also gives rise to a new Closing Disclosure form that combines the final Truth-In-Lending statement and the HUD-1 settlement statement while providing details on the entire real estate transaction – including loan term, fees, and closing service costs.  

The accuracy and delivery of the new forms will be critical to ensuring the mortgage process is not derailed or delayed, and that borrowers have a smooth home purchase process.

2. Lenders must now provide Borrowers with the Loan Estimate & Closing Disclosure Forms in 3 Days

Three business days after the consumer provides a lender with their name, income, Social Security number, property address, property value estimate and mortgage loan amount sought, the send that consumer his/her Loan Estimate & Closing Disclosure Forms.

3. Longer Approval & Closing Times

In order to comply with the regulations imposed by TRID, lenders will be extra careful while both evaluating clients & filling out necessary paperwork – thus translating to longer approval & closing times and pretty much eliminating the the possibility of closing ahead of schedule.

 

Unfortunately, this extended loan closing timeline resulting from TRID will impact the home buyer’s move-in logistics and timeframe. Nevertheless, the increased transparency regulations will undoubtedly help more home buyers understand their loan options.

 

 

TRID For The Borrower- What It Means

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There are officially t-minus two days until ‘TRID Day’, and whether you are a potential borrower or an existing lender, there are no reasons to panic. On October 3rd, 2015, the TRID (also known as the ‘Know Before You Owe Rule’) Rule  will be implemented by the Consumer Financial Protection Bureau (CFPB) as a way to better inform and protect borrowers during the lending process. TRID (short for TILA-RESPA Integrated Disclosure) is the merging of the Truth In Lending Act and Real Estate Settlement Procedures Act that aims to make the mortgage process more streamlined and highly functioning for regulators, borrowers, and lenders. Its goal is to create a more informed and therefore better protected consumer through regulated time constraints and clear, comprehensible documents for the consumer-which is why the act has attained the nickname ‘Know Before You Owe’.

The change comes in a time where transparency in every industry is essential for consumer trust and transaction, and when the Real Estate Industry has a need to shift priorities from stimulating the economy towards borrower comprehension in the lending process (seeing as it is one, if not THE biggest financial decisions they will make in their lives). The idea is that more time and more consumer-friendly documents will create breeding grounds for an all around more informed borrower.

So what specifically is changing under the TILA Act, you ask? Not too much. Here are the biggest two changes in the process:

1) Loan Estimate– As Rayce Robinson explains, what was originally the Good Faith Estimate has now changed to become the “Loan Estimate” or LE. The LE is created at the beginning of the lending process following the application submission of the borrower to their preferred lender and provides potential borrowers with a clear and accurate disclosure of any estimated fees during the lending process. The LE breaks things down for the buyer as well as makes it easier for buyers to compare estimates between firms.

2) Closing Disclosure– The Closing Disclosure, or CD, replaces the HUD-1. The CD is a detailed and accurate disclosure of every fee needed to close. The main difference with the CD is that lenders are required to provide borrowers with the document 3 days prior to closing to give them adequate time to compare the document to the LE as well as ask any questions they may have. Since last minute changes tend to occur when buying a home, after the borrower signs off on the CD, the lender need not add additional 3 days for changes unless they fall under three exceptions. 1) The last minute change caused APR to become inaccurate, 2) Borrower wants to change loan program, or 3) a pre-payment penalty was added to the loan.

The idea is to integrate the 3 days, not add them- something that will require planning, focus, and organization from all parties involved in the lending process.

TRID is going to be a refreshing change for the consumer in the Mortgage industry, and the biggest takeaway a potential borrower can get from the change is that there will be more transparency in a more simplistic fashion. It is important to find a lender who is trained, has tested, and integrated TRID methods into their practice- and at Alpha Mortgage, our loan officers are trained, tested, integrated and PREPARED to provide you with the best experience possible. Contact us today!

*Note: If you are looking to secure Home Equity Lines of Credit (HELOCs), a reverse mortgage, or a mortgage secured by a mobile home or dwelling not attached to real property, it is important to recognize that TRID won’t apply to you. *

How Much Does It Cost To Refinance My Mortgage

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You’ve done your research on the best time to refinance your mortgage,and you are ready to start the process before the Federal Reserve decides to start raising interest rates again. It seems like everything else is in place: you plan on staying in your home for a long time, lending conditions have eased, and current mortgage rates are extremely low. Refinancing or “resetting” a mortgage is a great option for homebuyers that want to take advantage of market conditions like lower interest rates over time, take the opportunity to reduce the term of their original mortgage, or acquire cash from the home’s equity value to use on other purchases through cash-out refinance transactions. Homeowners can also benefit from refinancing by reaping the rewards of an improved credit standing in most situations.

But how much does refinancing your mortgage actually cost? One thing that most homeowners forget to consider when considering a refinance is that there are fees associated with the process. These fees vary based on location and company, which is why it is essential to shop around before you refinance your mortgage. Below are some fees to keep in mind and to discuss with your lender before making a refinance decision:

  • Administrative Fees: Just like when applying for your original mortgage, there are administrative fees that cover generating the information and data necessary to obtain refinancing contracts. Administrative fees to expect include paperwork fees, appraisal fees, application fees, loan origination fees, points fee, inspection fee, survey fee, title search/insurance fee, and others similar.
  • Closing Fees: Once you have been approved for your refinance, closing fees come into effect under names like paperwork fees, attorney review/closing fees, or closing costs. These can get pricey, so it is important to take them into consideration before applying.
  • Other Fees: It is crucial to understand the terms and conditions of your refinance like the back of your hand. Discuss with your loan officer things like prepayment penalties (fees that can cost anywhere from 1-6 month’s interest payments) that charge you for paying off your existing mortgage early, and other penalty fees that could impact you financially.

Most mortgage-related fees are paid upfront at closing, however some lenders offer “no-cost” refinancing, which includes these fees in your loan balance or interest price during the term of your refinance. Once you take into consideration all of the fees that will be associated with your refinance, calculate the break-even point of your new mortgage through online resources. If the refinance still makes sense financially, sign the papers! If you’re feeling overwhelmed, don’t fret. The Home Ownership and Equity Protection Act (HOEPA) protects those who refinance from high fees and interest rates.

Alpha Mortgage is proud to serve North and South Carolina with the best mortgage rates and informed loan officers. Need more information about refinancing your mortgage? Contact us today.