$10,000 question: How much do you know about refinancing your mortgage?

If you're not up to speed on how to negotiate a good refinance deal, it could cost you thousands of your hard-earned dollars. And you'll need to know, since the average life span of a mortgage in the U.S. currently hovers between 3-5 years before it is refinanced. Let's take a look at some of the mortgage industry's inside information when it comes to refinancing.

Don't jump ship too early

There is no need to panic when talking about the timing of refinancing, even in an adjusting market. We need to have a legitimate benefit that we can grab on to, that gives us a starting point. These benefits can include: a lower APR, a lower monthly payment, consolidating debt (including second mortgages or equity lines of credit), and locking into a fixed rate if your current mortgage has the ability to adjust rates and payments at some time in the future. Once we know what we are after, let's see what you need to arm yourself with before you pick up that pen to sign on the line.

Talk to your current lender

It's never a bad idea to start with your current mortgage holder. Especially if it is the same company that originated the loan and has been servicing the loan. Your loan represents monthly revenue to them, and they don't want to see you go. Give them a chance to compete, and the process is usually as painless as it can get since they will have a lot of the background information that was taken at the inception of your current loan. There is no guarantee that they will give you the best deal, but it's a great starting point.

Make sure that your discussion includes questions about fees that can be waived due to them wanting to "retain" your loan. Many times, new appraisals and title fees can be something that can be negotiated with them. Also talk about the points (loan fees) that may be assessed, as this topic is to your advantage, remember, they don't want to lose you.

Due Diligence- A wider net catches more fish

After you have received an offer from your current lender, it doesn't hurt anything to talk to other companies to get a feel for what offers are out there. At this stage, the cost to you is your time, and allowing your credit to be reviewed by these companies. Now is not a time to panic about inquiries on your credit. Credit reports are another topic entirely, but sufficeth to say that when one is shopping for a mortgage loan, and several mortgage institutions

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