No cost mortgage refinance deals have become very popular. Their popularity is attributable to several things. It is firstly attributable to the aggressive manner in which they are marketed. The popularity of these zero cost mortgage refinance deals is also attributable to their name which is, to say the least, highly attractive. You have to keep it in mind that many people who are keen on refinancing their mortgages are put off by the cost of the whole thing. So when they get to hear of mortgage refinance deals where they wouldn’t have to incur costs, they are naturally only too keen to sign up. Now there is no denying that many of these zero cost mortgage refinance deals are good. But there are several crucial things you need to know about them.
Firstly, you need to know that although there are no explicit costs associated with no cost mortgage refinance deals, there are usually some implicit costs to be dealt with. It is totally unrealistic to expect to be in a position to refinance a mortgage without incurring any cost, and that is a reality you need to come to terms with sooner than later. It is worth noting that the folks who offer these refinancing deals are not in charity: they are in business, and they have to make some sort of a profit (from you). They may not charge you anything to refinance your mortgage, but they may pad up the other costs pertaining to the whole mortgage refinancing deal, and make a killing out of that. And forgetting what the people offering the mortgage refinancing deal have to gain for a moment, you have to keep it in mind that there are always some appraisal fees to be paid, whenever a mortgage is refinanced. Furthermore, there are always some title search fees to be incurred, as well as escrows to be set up. Then there are ‘closing fees’ to be paid, in one way or another, to the folks who market the mortgage refinance deals. You have to be ready to pay for all these things, even if there won’t be explicit mortgage refinance costs to be incurred.
Secondly, you need to appreciate that the no cost mortgage refinance deals don’t always turn out to be better than the ordinary mortgage refinance deals, when all the figures are added up. The best thing for you to do is to do proper calculations, to get insights on what you’d (really) have to pay either way: don’t be fooled by the ‘no cost’ tag, because we have already established that there are always some implicit costs to be catered for. Once you get full insights into the costs that would have to be paid either way, you can work out whether the supposedly zero cost mortgage refinance deals are the best.
Thirdly, you need to know that the claims made by the people who ‘sell’ the no cost mortgage refinance deals don’t always turn out to be true. These suave salesmen tend to emphasize on the ‘upsides’ to their refinancing deals, without mentioning anything about the ‘downsides.’ The best thing for you to do is to request for the mortgage refinance ‘terms and conditions’ and read through the fine print, to get a good idea as to what the refinancing deals in question are all about.