What are the Upfront Cost to Refinance a Kansas City Home?
Olathe Resident “Jack” Writes:
With mortgage loan rates so low, I'm thinking about refinancing my Olathe home so I can payoff some higher interest rate credit cards. What do you think and what are the cost and risk?
Real Estate Wizard:
Great idea, Jack, if the numbers work. Paying off high interest rate credit cards is always a great idea. The problem is do you have equity in your Olathe home and the credit to refinance?
First, figure out the value of your Olathe home. If you need help, contact an Olathe Realtor. A current mortgage lender will typically lend you 80% of what your home is worth, before they start adding additional fees and insurance. Figure that a current appraisal will be conservative.
Your upfront fees will typically be $400-500. This will pay for the appraisal and credit report. If you get the loan, this maybe credited back. If you back out, the application fee will typically not be refunded back because they will be paying for actual fees that have been generated.
The reasons why some homeowners back out of refinancing is there is not sufficient credit for the bank to issue the new loan or sufficient equity in the home.
If you like to figure your equity position before you apply for a refinance, contact an Olathe Realtor and have them figure a Broker Price Opinion (BPO) on your Olathe Home. Let the Olathe Realtor know upfront that you are planning on using the BPO to refinance. This may help in over-evaluations.
Lately, I have heard of quite a few refinances not going through due to low appraisals.
Best of luck, Jack, and if you need anymore help, feel free to contact the Real Estate Wizard.
Olathe Resident “Jack” Writes:
With mortgage loan rates so low, I'm thinking about refinancing my Olathe home so I can payoff some higher interest rate credit cards. What do you think and what are the cost and risk?
Real Estate Wizard:
Great idea, Jack, if the numbers work. Paying off high interest rate credit cards is always a great idea. The problem is do you have equity in your Olathe home and the credit to refinance?
First, figure out the value of your Olathe home. If you need help, contact an Olathe Realtor. A current mortgage lender will typically lend you 80% of what your home is worth, before they start adding additional fees and insurance. Figure that a current appraisal will be conservative.
Your upfront fees will typically be $400-500. This will pay for the appraisal and credit report. If you get the loan, this maybe credited back. If you back out, the application fee will typically not be refunded back because they will be paying for actual fees that have been generated.
The reasons why some homeowners back out of refinancing is there is not sufficient credit for the bank to issue the new loan or sufficient equity in the home.
If you like to figure your equity position before you apply for a refinance, contact an Olathe Realtor and have them figure a Broker Price Opinion (BPO) on your Olathe Home. Let the Olathe Realtor know upfront that you are planning on using the BPO to refinance. This may help in over-evaluations.
Lately, I have heard of quite a few refinances not going through due to low appraisals.
Best of luck, Jack, and if you need anymore help, feel free to contact the Real Estate Wizard.
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Blog post written by the Dowell Taggart Team of RE/MAX Premier Realty
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