When you decide to refinance your mortgage, you – most likely — seek an opportunity to pay less each month and minimize your expenses. Hiring a professional real estate lawyer for this process may sound irrational: why’d you want to pay more to someone when your main objective is to save? Even though it doesn’t seem to be the most logical decision at first, in fact — it’s a wise thing to do. Especially if you try to think several steps ahead. More information you can find at mbpropertylaw.com.
What is Mortgage Refinance?
Mortgage Refinance is an option to reduce your rate and payments by taking out a new loan, which replaces the old one. The main goal is to lower monthly payments, thus lowering your debt and consolidating your financial situation.
Can You Refinance Your Mortgage Without a Lawyer?
Yes, you definitely can — there’s nothing to hide here. Legal help is not mandatory in the mortgage refinancing process. However, it’s one of the cases when being able to do something yourself doesn’t necessarily mean you should.
Why You Need a Lawyer?
Although Mortgage Refinancing seems to be a simple process — it’s not elementary at all. Being a non-refundable type of loan, mortgage refinancing should be done with care to prevent any unforeseen circumstances in the future. Although financial experts say that ‘if you can pay it — you can refinance it’, actually borrowers face a lot of trouble while trying to get approved.
Refinancing lenders do not seem to be generous: they carefully analyze your credit history, calculate your income and strive to approve only those applications that are truly speaking in their favor.
Mortgage Refinance Problems
There are, to say the least, many possible negative consequences if you don’t know what you’re doing and have no sufficient experience with the refinancing process. Here are just some of them.
Refinancing is NOT always a good idea
If your income doesn’t allow any significant changes – don’t even think about taking out another loan. It’s too risky! Even if you managed — with a limited budget — to get approval, the probability of paying off your new mortgage is extremely low.
Improper Mortgage Refinancing Can Damage Your Credit History
As a consequence of the old mortgage loan, you might have to wait for a few years before applying for other loans or mortgages. In the meantime, your payments may be significantly reduced. This can substantially lower your credit score and influence future expenses — even if you don’t plan to buy another home in the near future.
Mortgage Refinancing Risks for New Homeowners
If you’re a new homeowner, be careful not to go overboard with your Mortgage Refinance dreams and make sure that your efforts won’t turn against you. Refinancing adds to your debt and if you’re laying out too much money at once — it might affect your future credit status.
It’s recommended to start small — and go through the whole process step by step. This way, you’ll see whether or not it’s worth it to continue.
Mortgage Refinancing Mistakes
Here are the most common mistakes people make in the process of mortgage refinancing. With a good real estate lawyer your chances to make a mistake are close to zero (so the only crucial mistake is choosing the wrong lawyer), but you still have to be aware of them.
Fixating on Just One Lender
Look for the one that offers the best possible rates, no need to limit your options. It makes sense to concentrate your efforts and resources on just one lender, it gives the impression that you are the most interested in the deal and this creates a better chance for you to get a better deal. But don’t stop there! Every lender has different rates and terms, and some of them aren’t good for you. Make sure your lawyer will compare every possible lender and find out who offers the best deal.
Fixating on Monthly Payments Only
It’s the big picture that matters, not just the amount of money you save each month. In most cases, you can easily save more money in the long run by refinancing. Take into account all costs, fees, and taxes, and think about your future goals.
Refinancing Too Often or Missing the Opportunities
Looking for balance is always challenging, but both of the extremes will cost you a lot of money in the future. If you will miss a good refinancing opportunity, you definitely will regret it later. And if you will see these opportunities too often, your credit history will be ruined by all the refinancing attempts, and getting a truly beneficial option will get harder and harder. Finding that balance is exactly what your real estate lawyer should help you with.
What Do You Lose If You Don’t Hire a Lawyer?
What can you lose if you try to handle this process by yourself? First of all, a lot of time. Hiring a lawyer will take only a few days, thus saving you unnecessary troubles and fears.
What else can you lose? At the top of the list — your hard-earned money.
There’s always the risk of legal issues arising during Canada’s mortgage refinancing procedure. If you want to be absolutely sure that the process is being done properly –— hire a lawyer.
How to Pick a Lawyer for Mortgage Refinance
It’s easy to find a lawyer online. But how do you choose one and make sure that you won’t feel cheated afterward? The easy way to get professional help and pay no more than the fair price for your exact situation is by hiring MB Law experts.
And in case you want to compare multiple law firms — here’s how you can find the best option yourself:
First of all, it’s wise to share your plans with friends and family members just in case they can recommend someone they know.
It’s important to find a real estate lawyer that has experience with the mortgage refinance process. When choosing a lawyer, remember to ask:
- How long have you been in the mortgage refinancing business?
- Are you a member of any professional organizations and what are your credentials?
- What type of experience do you offer?
- Is it clear that you’re talking to a trustworthy, honest, and competent lawyer?
These are various types of questions that may help you check out a lawyer’s experience and qualifications. An experienced lawyer will be able to give you no-nonsense answers, a bad lawyer will speak in vague terms and avoid direct answers.