Thanks for your question, Tina. I'm glad that you've decided to do your homework before committing to a loan. Many borrowers fail to ask questions or comparison shop, and end up paying a lot more for their loans than they should pay.
First, I would also strongly encourage you to compare rates and offers from multiple lenders. You can apply with Bills approved lender network (Mortgage Refinance Quote), and see if you can get a better deal!
It is difficult for me to accurately answer your question, as I do not know the value of your home, the amount you are trying to borrow, the terms of your current loan, or your credit score. Without this information, I cannot accurately estimate how much you should expect to pay for a refinance loan. However, I can tell you that a 12.88% interest rate is quite high, and I would encourage you to shop around to find out what rates other lenders are able to offer you. I expect that you will be able to find a significantly lower interest rate offer if you take some time to speak with various lenders to find out what rates they can offer.
The appropriate amount of the closing costs for a potential loan is much more difficult to judge, as the amount of closing costs are generally calculated as a percentage of the loan amount. If your loan is for $100,000, then $13,000 in closing costs is extremely high, but if you are talking about a 500,000 loan, $13,000 is not unreasonable. On average, closing costs range between 1% and 5% of the total amount of the loan. Since you have poor credit, you can expect to pay closer to 5%. So, if your refinance loan is for $100,000, you should expect to pay $4,000 to $5,000 in closing costs.
Overall, it sounds like the loan you have been offered is a relatively high-cost loan. Again, I encourage you to shop around to find a lender who can offer you less expensive loan option. I invite you to visit the Bills.com Home Refinance Resources page to learn more about refinance loans. If you enter your contact information in the Bills.com Savings Center at the top of the page, I can have several pre-screened mortgage lenders contact you to discuss the options available to you.
I hope this information will help you Find. Learn. Save.
Best,
Bill
www.bills.com
April 28, 2008
April 27, 2008
August 22, 2007
August 22, 2007
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