Borrowers stuck with mortgages that are more expensive than they had expected can no longer count on a quick home sale to bail them out of the deal. It's pay up -- or refinance into a loan with better terms.

Thanks to an upswing in delinquencies and foreclosures -- and new scrutiny from federal regulators and Congress -- mortgage lenders have tightened their standards for granting loans. And with home prices rising modestly, if at all, appraisers are tightening their opinions on value.

Lender standards tightening
If you're looking for a refinance, whether it's because your current mortgage will soon adjust to a higher interest rate or because you'd like to borrow extra cash against your built-up equity, you can expect lenders to be more demanding about your credit, your ability to document your income and the appraised value of your home. They are less likely to OK new mortgages if the monthly payments consume more than 28 percent of the borrower's monthly gross income, or if, combined with payments on other loans, debt repayment consumes 36 percent or more of income.

Even if you're not looking to take cash out, lenders are likely to demand that your new loan account for less than 100 percent of your home's current value, even if you bought it only a couple of years ago with a zero-down payment loan.

Wiggle room with prepayment penalties?
One of the first steps a would-be refinancer must take is to determine whether there is a prepayment penalty on their current mortgage. "Prepayment penalties are very common," says Lez Trujillo, national field director for ACORN Housing, a nationwide homeownership counseling service headquartered in Chicago.

"When you got such low interest rates with an adjustable, the hook was you couldn't get out of it very soon," she says. Penalties can equal six months of interest payments, and they're triggered if you refinance (and sometimes even when you sell the home) within the first two or three years of the loan.

While it's easy to advise consumers to "find out whether you have a prepayment penalty," in reality, it can be tough to find. There won't be a piece of paper with "Prepayment penalty" in large, bold type at the top.

Mortgage documents are not standardized. It could be hiding anwyhere in that thick stack of loan documents, and it might not even say "prepayment penalty." Some lenders have substituted the warmer, fuzzier phrase, "committment period."

A typical prepayment penalty will charge you a year's worth of interest if you refinance in the first two years. It may have a definite expiration period, or it may phase out over time.