Refinancing not as easy as it looks

Nov 1st, 2007 @ 7:01 PM by MortgageMentor

Have you been considering a refinance on your home? Even with today’s market, sometimes it still makes sense to refinance the loan. If so, it pays to shop around.

You’ll find that not only the rates and terms vary from one loan company to another; the person on the other end of the line has a lot to do with the response you get, too. A lender who is more interested in selling you “this week’s hottest package” than listening to your needs will quickly cause you to hang up the phone and look for the next number on the list. Sometimes, as I found out myself a couple of weeks ago, the loan officer has misinterpreted part of his or her own guidelines, resulting in a silly-sounding rule. In this particular case, I was told that using my business banking account to deposit my business income, then paying myself (into my regular bank account) caused me to be ineligible for a loan.

“But the IRS says that if you are self-employed you should use a business account,” I argued.

“That’s not true,” the lender told me. “People deposit 1099s to their personal accounts all the time.”

“Maybe they do but they shouldn’t,” I insisted. She told me I was both wrong and ridiculous.

Next.

Another lender offered a high rate, much higher than the rate I have already. One offered me a loan with goo terms, but only if I would borrow $20,000 more than I wanted.

The whole thing was pretty frustrating, especially since I write all the time about mortgages; I thought that knowledge would help me work through the maze. Instead it only revealed how little people know about their own products. Many of my (very normal) questions were met with, I’ll have to ask my manager.

So in the middle of the nonsense, I turned on the TV and saw the tail-end of a CountryWide ad. I immediately called the number and asked whether I heard correctly. “No closing cost, no application fee, what’s the catch?”

Chris at Countrywide was most helpful, and within a few hours he had my new loan set up. It has great terms, it’s the small amount of money that I wanted to borrow, and I’m paying nothing up front. Best of all it will close in less than two weeks.