Three Reasons Refinancing Your Mortgage is So Complicated
Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
Mortgage interest rates are on the rise, but today’s rates are still well below the historical average of 7 percent. If your interest rate is above today’s average, you may have already tried—and failed—to refinance your mortgage, maybe more than once.
Why, if you have remained current on your mortgage through these tough economic times, is it so hard to refinance? Why does the process remain so time-consuming, cumbersome, and expensive?
Being unable to refinance is especially frustrating when you consider how much emphasis has been put on refinancing in the past few years. The Obama administration created and expanded the Home Affordable Refinance Program (HARP) to help borrowers with Fannie Mae or Freddie Mac loans refinance their homes.
And in early 2013, the Responsible Homeowner Refinance Act of 2013 was introduced in an effort to remove the barriers that prevent many homeowners from refinancing into loans with lower interest rates. (That bill was referred to committee in February 2013.)
What’s preventing me from refinancing?
If you are a borrower who has continued to make your mortgage payment despite being underwater on your mortgage or having a high interest rate, you are probably frustrated with the banks, the government, and the real estate market. You are not alone. It seems that the majority of focus and attention has been spent helping borrowers avoid foreclosure and streamlining the modification process for distressed borrowers who have fallen behind on their payments.
Key factors as to why refinance transactions aren’t as simple as they should be include:
What can I do?
The best advice I can offer is this: Start the refinancing process with a great deal of patience.
In the current housing environment, it seems policymakers should be taking a much harder look at simplifying and accelerating the refinancing process so that many more owners can benefit. Many homeowners stand to save a lot of money from a simple rate reduction refinance.
Hopefully the efforts of the current administration and the continued outcry from consumers who feel left on the sidelines will spur the necessary change for the future.
Alanna McCargo is a housing and financial services executive and personal finance writer and advocate. She is a public speaker on hot topics in financial services and the housing market, and she writes a personal finance blog called “Matter of Money.” She is an active volunteer and serves on the board of directors for the Women in Housing & Finance Foundation, a non-profit dedicated to advancing financial literacy, housing policy issues, and education programs for women, children, and under-served communities. Follow Alanna on Twitter @myhomematters.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.