Quote:
Originally Posted by lewdog
Someone explain the difference between a mortgage refinance and a mortgage modify.
I just want a lower interest rate without having to pay the $4k needed in closing costs and go through the whole appraisal process. I am pretty sure the modify part doesn't fit my scenarios or more people would just do that instead of refinancing to an entirely new mortgage.
Someone fill in the blanks for me.
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Modifying the existing loan occurs when you call the current mortgage holder and they agree to lower your rate, probably for a fee. However, they have very little incentive to do so since they know the costs of refinancing are high.
Refinancing requires that you originate a loan from the beginning with a new lender, which will require an appraisal, an inspection, a new mortgage document (to be recorded) and new title insurance. You will also pay an origination fee. But at least you won't have to pay a real estate broker.