Last Chance to Revisit Your Mortgage

Focus: REAL ESTATE

Terry Savage Image Terry Savage Author, The Savage Truth on Money

With the market starting to turn the corner, incredibly low rates won't last forever, so follow these tips if you're looking to buy or refi, writes MoneyShow personal finance expert Terry Savage.

It’s a great time to get a mortgage. I’ve been telling you that for several months. The housing market is starting to firm up, with sales and even prices increasing in some areas.

But financing a house is not just a decision about interest rates. There are other fees and costs involved, and several ways to deal with them. If you’re not a mortgage expert, you might need help from a good mortgage broker

.Many lenders—whether large banks or online services—simply plug in your data into a form to see if you “fit”. They don’t have the expertise to help you create a mortgage that is tailored to your needs and your special situation.

So when I recently advised that you go online to check mortgage rates in your area—still a good idea at www.Bankrate.com—I was reminded by several mortgage brokers that the “right” loan for you is about more than just the interest rate.

Mortgage Rates Are Only Part of the Deal
Of course, everyone compares interest rates on a mortgage loan. But that’s only part of the total cost of your mortgage loan.

In fact, a new proposal by the Consumer Financial Protection Bureau to create a simple “zero-zero” mortgage (no fees, no points) in order to make comparisons easier for consumers, is likely to cost them more.

Randy Johnson, a widely respected California mortgage banker, writes a mortgage newsletter than ran through the reasons a one-size-fits-all mortgage could wind up costing consumers a fortune over the life of the loan.

He explains that there are always costs in getting a mortgage, not only for the services of the broker or lender, but also for appraisals, title search, escrow holder, etc.