Perhaps you are a recent first-time homeowner who took advantage of low downpayment programs to buy your own home. Now after making payments for a year or two, you want to refinance. With home values soaring, you could potentially eliminate the need to carry private mortgage insurance and reduce how much you pay each month.
Maybe you just realized that locking in the lower rates now could save you thousands over the course of your mortgage payments. Whatever your motivation, refinancing is a process you should handle carefully. Issues with financing could put your house and the money you’ve invested in it at risk. Working with an attorney during a refinance can help you avoid the biggest possible risks.
What can a lawyer do for you when you refinance?
Catch scams and unfavorable terms before you sign
While finance is a heavily regulated industry, there are still individuals and companies that actively tried to defraud homeowners and borrowers. You will likely struggle to make sense of the technical language in your mortgage documents, which leaves you vulnerable to misconduct by the company involved or the broker assisting you with the refinance. Having your own attorney review the paperwork helps ensure that you aren’t about to fall victim to a scam.
Identify the warning signs of a risky mortgage
There are more controls on unusual mortgage products, like those with a large balloon payment, than there were a couple of decades ago. Lenders must be more transparent when providing you information about the mortgage program when you finance or refinance a home.
Still, you may not truly understand the terms in the paperwork and could agree to something that is ultimately not favorable for you, such as a requirement to pay off the mortgage in a certain number of years or refinance it again.
Focus less of your energy on the details
Refinancing is often stressful because people have to learn a lot of jargon and manage many different concerns all well simultaneously continuing to work their regular jobs and care for their families.
When you have an attorney managing the process for you, you don’t have to spend so much time focused on the minutiae of the refinancing process. Your lawyer can handle most of the details, while and you can keep your focus on what matters most, like your professional success and your family.
Working with an attorney during a refinancing attempt or other real estate transaction will protect you from mistakes and risks.