We are going to discuss 3 major lending mistakes that borrowers routinely make when applying for a St. Louis mortgage refinancing.

1. Interest Rates and How It Affects You

One of the biggest mistakes any homeowner can make when contemplating a refinancing is solely basing their decision on current interest rates. Of course, getting a lower rate can indeed save you large amounts of money over the life of the loan not to mention an immediate savings if it lowers your monthly payment.

The first step to consider before you apply for a new loan is being certain of all aspects of said loan. You need to fully understand all fees involved that are associated with your new lower rate. And don’t think you deserve a free loan. Most clients have to pay points so be expecting this when closing.

Of course, most educated consumers know that paying up front points can yield favorable results thus giving you a lower interest rate. This will save you money over the term of the mortgage and possibly a lower monthly payment which homeowners readily accept.

2. Always Review the Good Faith Estimate

The next mistake to avoid is not taking the time to go over the Good Faith Estimate the lender or mortgage broker provides. Read it and read it thoroughly so there are no questions in regards to the proposed A.P.R., the interest rate and all fees involved.

One thing I inform all potential refinancing clients is that the Good Faith Estimate is exactly what it is called, an “estimate.” Figures may be a little different due to an unexpected lower credit score, appraisal or maybe your debt-to-income ratio is a lot higher once the lender sees all your debts from your credit report.

When discouraging information appears unexpectedly and changes the GFE numbers, the worse thing you can do is blame the lender or mortgage broker. Let’s face it, you are responsible for your bills and what is on your credit report. The point being made here is if the numbers on the GFE change drastically, that is the time to have a heart-to-heart talk with your loan officer.

When it comes to St. Louis refinancing home loans, they should be drawn up to help you and your family accomplish your financial goals and not be an additional burden.

3. Refinance Now? No, I Think I Will Wait For…

It’s human nature to watch interest rates on a daily basis especially when they are unusually low. The consumer may feel they will jump in at the right moment yielding them the lowest rate possible.

There are times in life when you just need to take decisive action if it makes financial sense. When interest rates are lower than your current one may be the deciding factor towards moving forward with your St. Louis refinancing.

By following through and using these proven lending tips when applying for your St. Louis mortgage refinancing loan, you will be closer to accomplishing your goals of saving money and/or paying off your high interest debts.

Learn more about a St. Louis refinancing home loan. Stop by Floyd J. Tapia’s mortgage news blog where you can find out all about St. Louis mortgage tips and what they can do for you.