A Title Company’s Role in Refinancing - A Quick Guide

Despite your original commitment to timely mortgage payments, unexpected difficulties can create hardships. When these problems take you by surprise, refinancing may be an option for you to try and lower your mortgage payments. Communicating with your lender will definitely assist you in your search for a lower interest rate.

Refinancing a home can be overwhelming to those new to the process. In accordance with our commitment to thorough and competent service, we'd like to offer the following quick guide to refinancing.

In loan refinancing, you are addressing the outstanding original loan by using a new loan to pay it off. Closing costs for refinancing can range from anywhere to 2-5%, with the average being 1.5%. Your interest rate, credit score, and type of loan are among the chief factors that determine your payment. 

During refinancing, you or your lender will choose a title company for research purposes. The title company’s responsibility is to determine that you are, in fact, the owner of the property. This evaluation is normally completed through a title search. The title company is also looking for factors such as outstanding judgments that the lender could ask to be paid before proceeding with refinancing.

Those who choose to go forward with refinancing may be curious about title status and have questions about title insurance.

* Title insurance isn’t paid through monthly premium, but instead by a one-time fee at closing. The lender seeks protection through title insurance at the time of closing. 

* Title insurance promotes investor confidence as mortgages are security-backed. Investor risk is minimized through title insurance.

The lender will provide you with a closing disclosure, which outlines how the loan will be disbursed and used. Ultimately, a title company acts as a go-between, or intermediate party, for all of those involved in refinancing, ensuring the process is free of headaches. 

 At Homestead Title, we handle the coordination of all parties of interest so that your refinancing runs efficiently. We also take the time to ensure that all documents are in order, so that you will experience a “smooth road” to refinancing. Call us today at (504) 581-6427 if you have any questions or would like further information on how we can help you.