What Can You Negotiate When Refinancing With the Same Bank?
- Interest rates are typically priced to include additional revenue for most banks. A current customer who needs to refinance might be able to negotiate the posted interest rate. An option is to present interest rate quotes from competing banks to give your lender an opportunity to keep your business. Obtain several good faith estimates from nearby banks to show your banker. Your banker might match a competitor's offer to retain the servicing of your loan.
- Fees are often charged to increase a bank's profit per refinance transaction. However, you may be in a position to negotiate some of the service fees. Ask your banker if he can waive fees that might be identical to the costs you paid on the last transaction. For instance, you could challenge certain administrative or processing fees, as well as fees charged to photocopy and prepare documents. Using estimates from other lenders can provide leverage during your negotiations.
- If your lender provided slow or questionable efforts towards processing your last loan transaction, ask the lender for a commitment to expedite your loan more seamlessly. Negotiate a firm closing date and get a written commitment for a refund of certain service fees if the bank misses the closing date. You can negotiate a refund for appraisal fees, home inspection fees, credit report fees or other items.
- Many items are negotiable when refinancing with your bank. You can request a mortgage due date that's in the middle of the month, versus on the first day of each month. Your bank may honor your request to keep your business. Your banker might even waive or reduce some of your settlement fees as a result of your negotiations.