What exactly are the logistics of refinancing a mortgage?

Question

When you get a mortgage for buying a home, the logistics (all the paper signing etc...) are usually handled by the lawyer responsible for the overall home purchase in conjunction with real estate agent; once you get pre-approved for the mortgage.

However, when refinancing, there's no real estate agent or lawyer involved. So, if there is no insurance agent involved either (the person managed to find a good online mortgage themselves), what exactly are the logistics involved? Does the mortgage company handle everything? If not, what is needed to be done and expected of the refinancing person?

Answer 1

I don't know your experience, but I've never personally seen a lawyer involved in a "typical" real estate closing (either a purchase or a refinance). Perhaps this varies from state to state.

The process for a refinance would be as follows:

• Shop around for the best deal for you, which may mean the lowest effective rate or the least amount of cash up-front, depending on your situation.
• The mortgage broker or bank's loan officer should handle all of the logistics of getting appraisals, engaging a title company for closing and title insurance, etc. (you have the right to choose a title company, but the bank should give you one they recommend)
• Your responsibility is to provide all of the paperwork required by the lender: bank statements, pay stubs, proof of insurance, etc.
• The closing is done by a title company who makes sure all of the contracts are executed properly (and provides title insurance).

A lawyer can certainly help make sure you're being treated fairly (is the appraisal accurate? Were fees added on that weren't in the initial quote?) but in a typical refinance this may be overkill.

Answer 2

Ditto DStanley, but let met add for clarity, the couple of times I've refinanced a mortgage, the new lender took care of all the legalities and paperwork. I just had to sign a ton of forms. I did not have to contact anyone else, title agent, lawyer, realtor, etc.

You certainly should shop around for the best deal on the loan. Beyond that, fees charged by third parties are generally beyond your control and not worth worrying about. You can't shop for a better deal on taxes and government fees -- governments don't tend to allow a lot of competition in this area. I presume some title companies charge more than others, but their fee is typically several hundred dollars. If you rejected the title company suggested by the lender and searched for a better deal, you might end up saving $50 or $100, i.e. an amount that would be lost in the rounding error on the loan. I've never thought it worth the trouble.