No Cost Mortgage Refinance

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By Investor Jim


Personal finance is never without the inclusion of home ownership concerns by people who have worked so hard to afford their own home.  For the most part, people live off of funds that they do not necessarily have in actually and the practice of borrowing money has become widely accepted within most societies which is one of the reasons why people are compelled to move forward.  When it comes to mortgages, they do not only refer to the process of securing funds in order to buy a home, they also refer to the act of borrowing money using the same property as collateral.  One of the choices in remortgaging is a no cost mortgage refinance which is very popular when interest rates are down and there is a great chance of taking advantage of no upfront payments. 

You should know that a no cost mortgage refinance will not exactly be a walk in that park especially when you look at its long term financial ramifications.  You are in turn actually committing your income for the next two or three decades to the payments that need to be made.  Make no mistake about it, this kind of borrowing is not for everyone and it is certainly not something that you should rush into doing. 


There are basically three kinds of no cost mortgage refinance:

1. No points but you pay lender fees and third party fees
2. Zero lender fees but you pay third party fees
3. No cash upfront but all fees and costs are bundled into the loan’s interest rate

An honest to goodness no cost mortgage refinance entails the same interest rate as other types of loans and no payments will be made to the lenders or any third party. You will have to make a thorough study of the state of your finances before you should decide to go on with this type of borrowing. This option is best for people who are planning to sell or refinance in a few years. IF and when interest rates are steadily falling, you can move from one no cost refinance to another without any cost on your part whatsoever.

If you are planning to stay in your house for at least five more years, this type of refinancing is not the best option for you. You also have to see just how the payments will fit into your earning capacity at least for the foreseeable future. Signing on a significant financial arrangement such as this one, will have a staggering effect on your purchasing power and will limit your options when they really count.

Should you be determined on making this move, you should at least deal with a credit institution that will be able to make you a good deal, one which you can actually afford. Go for prime lenders as much as possible because you will have a better chance of saving money than if you will deal with subprime credit companies that will surely cost you more than what is fair.

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BrokeBrokeBroke  says:
5 months ago

I wanted to do a mortgage refinance with no closing costs but had a hard time finding a place, but when I looked at no cost mortgage refinance rates I found out for just a little higher interest rate I could refinance. It wasn't "free" which I would have liked, but it didn't take any upfront cash so I was sold.

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