What Are the Costs of Refinancing?

what are refinancing costs

by Ron White

Refinancing your home comes with a price.

Closing Costs

When you seek to refinance your mortgage, the lender often requires you to pay various fees. These fees, referred to as closing costs, help the lender determine the condition and value of your property. The specific fees include an application fee, which goes toward processing your loan and checking your credit history, and an appraisal fee, which is used to pay someone to determine the value of your home. Another fee is assessed for the title search and title insurance that must be paid.

Loan Origination Fees

This fee is a finance charge added by the lender at closing. The fee is assessed as a percentage of the loan amount. The fee is expressed in points. Each point is

equal to 1 percent of the loan amount. Points can range from one to three. In some cases, points are paid as part of the closing costs. In other cases, though, they are financed on top of the original loan amount.

Prepayment Penalty

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    Source: homeguides.sfgate.com

    Category: Credit

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