What do you look for when shopping for a home mortgage?

If you decide to refinance your mortgage, shopping around bycalling several lending institutions to ask each one what interest and fees they charge will help you get the best deal available. Also askeach about their "annual percentage rate" (APR) and compare them. The APR will tell you the total credit costs of the refinancing, including interest, points, and other charges. Remember, you do not have to refinance your mortgage with the same lender that provided your original mortgage. However, to keep your business, some lenders will offer their original mortgage customers the incentive of lower mortgage interest rates, sometimes with reduced closing costs.

What disclosure must the lender give you?

For a refinancing, the lender must give you a written statement ofthe costs and terms of the financing before you become legallyobligated for the loan, as required by the Truth in Lending Act. Youwill want to review this statement carefully before you sign the loan.The disclosure tells you the APR, finance charge, amount financed,payment schedule, and other important credit terms. If you refinancewith a different lender, or if you borrow beyond your unpaid balancewith your current lender, you also must be given the right to rescindthe loan. In these loans, you have the right to rescind or cancel thetransaction within three business days following settlement, receiptof your Truth in Lending disclosures, or receipt of your cancellationnotice, whichever occurs last.

Will the lender refund your applications fees if you do not sign the mortgage?

When you apply for a mortgage, some lenders require you to pay aspecial charge to cover the costs of processing your application.The amount of this fee varies, but it may be $100 to $200. Usually,you must pay this charge at the time you file the application.