They’re arriving by mail, by email, and by fax. In fact, so many offers to refinance have been arriving that mortgage lenders are bending over backward to get their offers noticed. One of the country’s largest lenders has taken to sending its refinancing offers by overnight delivery.

Sign here. That’s what lenders want you to do in this, the largest financing and refinancing boom in the past forty years. Although lenders are backed up with applications, they’re out soliciting business as if they didn’t have any. A highly competitive marketplace means homeowners can almost name their own terms.

As I wrote this, recent deals included an offer for a 15-year loan at 5.5 percent with zero costs – a true no-cost loan. Not sure you’re sticking around for that long? You might try a 5/1 adjustable rate mortgage with an interest rate of 4.875 percent and just $800 in fees.

Rates are so low they inspire almost inspire homeowners to giggle with pleasure. Remember that 10 percent mortgage you were happy to get back in 1988? What about the 18 percent loan you were grateful for in 1982?

Now, at a time when cash-strapped, debt-laden homeowners need it most, a gift comes in the form of interest rates about equal to those our grandparents paid.

With the average $100,000 home appreciating at about $500 per month or more, tapping into that pot of gold seem almost too easy. But that’s where mistakes are made, lenders say. Here are some of the biggest mistakes homeowners are making in their haste to nail down what they think is a good deal.

-Thinking your current lender will offer you the best deal.

Many homeowners naively believe that their bank or mortgage lender will offer them the best mortgage package. Why? Because logically, it makes sense to take the cost of finding another loyal, happy customer and reward a current loyal, happy customer for sticking around.

Unfortunately, banking and lending economics seem to dictate the opposite. Instead  of rewarding loyal customers with a good deal, most lenders offer a mediocre deal, hoping it seems good enough so the loyal customer will be too grateful to shop it around.

-Not shopping around.

Just because your lender offers you a good deal doesn’t mean you can’t find a better one with a little bit of elbow grease.

Lenders are so competitive that there are opportunities nationwide to get a terrific deal on whatever sort of mortgage program suits your family’s particular financial needs. But homeowners sometimes seem reticent to make the effort, even if it means they’ll save and extra $25 or $50 per month.

Get over it. The current marketplace demands that you put forth a little big of effort to reap a huge reward. Educate yourself about rates being offered in your neighborhood at and the lender ads in this newspaper’s real estate section. Before you sign an application, check for any complaints against this lender at the Better Business Bureau (

-Taking the deal at face value.

Too often, consumers never look beyond the surface of a mortgage deal. So at the closing, they discover extra fees and charges, onerous prepayment penalties, and sometimes interest rates that are higher than they were originally promised.

Yes, the bait-and-switch lives. And consumers who don’t ask the right questions or get it in writing will get caught every time.

-Paying too many fees.

The average American family refinances its mortgage every 18 months. Before the ink is dry, they’re out looking for a better deal. Even if they don’t refinance, the average homeowner moves every 5 to 7 years, so the loan gets paid off then.

With so much turnover, it’s unnecessary and even unadvisable to pay much in the way of upfront fees and costs when refinancing a mortgage. If you pay $5,000 in fees, but save $500 per month, you’ll still take 10 months to pay back the cost of the refinance. Better to pay $800 in fees and save only $400 per month. Then, the payback time is cut to 2 months.

The only exception would be to pay an extra fee to buy down your interest rate permanently. You should only do this is you believe that interest rates won’t fall to 60-year lows (they’re at 40-year lows now) and if you believe you’ll stay in your home long enough to make this pay.

Of course, if you don’t do the math, you’ll never know if you’re getting a good deal. Not putting pencil to paper may be the single biggest refinancing mistake homeowners make.