1. Compare rates

Mortgage rates vary widely, so experts recommend doing lots of research before settling on a deal. It helps if you make an effort to make a comparison between financial institutions to find out the company that offers the most competitive deal. According to a Mortgage Loans Tempe company, they are seeing an increase in pricing disparity between lenders, which means it's more important than ever to shop around for your loan. Rates can vary by 1% or more from lender to lender. This could mean a difference of about $140 per month on a $250,000 loan as an example.

However, there's more to consider than just interest rates. You should also be able to compare the fees and quality of service a company delivers. As suggested by a company with a Mortgage Calculator Mesa service, when borrowing money, you should also ask people who have been customers of respective companies so that you can get a personal endorsement or a negative feedback coming from them.

2. Know your break-even point

The interest rates on mortgages have not been as low as it presently is for decades. It may be very tempting, but this opportunity might not be for everyone. People who already have mortgages with fairly low rates might consider skipping a refinance, as a new loan typically carries thousands of dollars in closing costs suggests a Jumbo Loans Scottsdale company. The company also suggests doing a careful analysis to calculate your break-even point like how many months it will take to recoup your closing costs. You can do this with a pencil and paper, but mortgage-oriented websites often have online calculators to make the job easier.

3. Confirm a rate-lock in your loan.

Today's historically low mortgage rates have left many lenders swamped with refinance applications, said a Mortgage Loans Glendale company. It's crucial to have your bank lock your rate in writing. Most lenders will send you a "rate-lock sheet" by fax or email upon request, confirming the mortgage rate you're getting and spelling out when the rate lock expires. The idea is to hold your lender accountable for the rate commitment they're making. You also want to show the lender that you're an educated and informed consumer. A company with a Mortgage Calculator Phoenix feature recommends asking for at least a 60-day rate lock in today's busy refinance market, and quizzing banks to make sure they can close your deal before the lock period expires.

These three crucial tips will definitely help you in making the right decision whether you should refinance your lunch or not. It is important not to get too decisive immediately when dealing with money matters like these. Make sure that you know what you are getting into and make the necessary research to guide you in your decision making.