WITH MORTGAGE INTEREST RATES AT OR NEAR HISTORI CAL LOWS. REFINANCING VOLUME HAS HIT AN ALL TIME HIGH. IF YOU ARE THINKING ABOUT A REFINANCE OR PURCHASE LOAN. HERE ARE SOME "POINTS" YOU MUST CONSIDER:

Points: A point is equal to one percent of the loan balance. Points are considered prepaid interest For a purchase loan, points may make sense to buy down the interest .rate. For a refinance loan, they offer little benefit.

Whenever you add to the balance of your loan, you must consider the "pay back period" for the benefit of the lower payment. Example: You add $3,000 to your loan balance to save $100 per month. Is it worth it? Probably not.

Closing Costs: One refinance scenario is to pay :zero points for the loan but pay closing costs. These Costs include escrow, title and appraisal fees along with processing, underwriting and recording. These costs usually total 1.5% to 3% of the loan amount depending on the loan size. Most fees are generally third party fees, that is, they are paid to services other than the lender/investor.

No Points/ No Cost Loan: This is by far the best way to fund your refinance loan. Not only are you paying :zero points, but you're not adding any costs to the balance of your loan. You pay off the principal balance only. How does it work? The lender pays . a premium to fund a higher interest rate loan. This premium then is applied to your closing costs. Result - you get a loan that has the benefit of lowering your payment without increasing your principal balance! Cash Out Refinance Loan: You can use your increased equity for any reason: home improvement, college education, investments, etc. Get the benefit of borrowing at extremely low rates.

There are many other types of refinance loans as well, including shorter-term loans, adjustable rate loans, interest only loans and prepayment penalty loans. Before you consider any refinance loan, study your good faith estimate provided by the lender/investor. It spells out all the fees associated with your loan.

Prime Mortgage, Inc. has been operating since 1987. Their business is based on successful referrals. They offer competitive rates, return calls promptly and answer any questions thoroughly. Their California Department of Real Estate license number is 01022024, and NMLS Co. ID 239064. You can reach them at (818) 992-9210.