What is the whole purpose?

Question

what is the whole purpose of re-finacing ... i get the point that you get a lower interest rate but does the company that you re finace through up the price?

Answer 1

They can!  And the mortgage broker makes money every time.  Most of the time that money they make is added into the loan, so you don't even see it.

Answer 2

refinancing at the moment is government inforced i believe, because no client nor lender can afford to keep these ARM mortgages, the more people that default the more money lenders lose too.

Answer 3

Not sure what this has to do with insurance - the category you posted to, but...



The purpose is to get a lower interest rate while rates are lower than when you took out the original loan (or last refi).  Yes, the company will charge for doing the refi, but this could still save money.  The "price" in loans is the interest rate (plus points and costs), so that part of your question doesn't quite make sense, as written.