Most people assume that the mortgage they agree to when buying a home will be the one they’ll have for as long as they live in their home but that isn’t always the case. Sometimes you’ll find that the market changes, along with what’s being offered by lenders.
If you’re considering refinancing your home, you need to look into what the process requires. It isn’t for everyone but if the timing is right and you are smart going about it you can save some serious money.
Examine Your Financial Standing
As such you only want to refinance if it makes sense to pay some up front in hopes of getting a better payment structure for the rest of your loan, especially if you’ve got something like a large balloon payment coming up.
Check your credit rating. Lenders always look at your credit to try and determine if you are trustworthy and the better your credit score is the better your offers will be. If it turns out your credit score has declined since you got your mortgage then you should probably take some time to work on it before you try and refinance.
In short, you want to make sure that you are planning on refinancing your home for the right reasons and that you are likely to get a good deal when all is said and done. Once you start leaning towards refinancing it’s time to move forward.
Collect Relevant Paperwork
You will need to prove yourself worthy of a good deal, no lender will just take your word for it. They’ll want to see paperwork and the sooner you start gathering it the better off you’ll be since you don’t want to scramble for it later in the process.
You may be asked to provide evidence of your income, tax returns, proof of employment, bank statements, credit reports, proof of outstanding debts, records of assets, etc.
The specific documents required vary from lender to lender but whatever is asked of you your goal needs to be proving evidence of your earning, responsibility, outstanding debts and insurance.
The more thorough you are the better – you’re not helping yourself by holding anything back.
Research & Contact Different Lenders
As with just about anything else in life you can’t be sure you’re getting the best deal unless you’ve looked at a few.
The first lender your should look at is the one you’ve been paying for years now. People who look into refinancing tend to be dissatisfied with their current deal and it makes sense that they’d want to look at new lenders for a new deal but this isn’t always the wisest choice. By going with your current lender you can avoid certain fees so if possible you should stick with them.
Still, you shouldn’t assume that your current lender is the best game in town either. Assumptions don’t belong in the world of refinancing. Research different lenders and talk to them, getting their offers so that you can make an informed decision.
Once you have all the offers you want or have the time to get then it’s time to compare, contrast and make a decision. Make sure to examine and compare every detail of the offers and remember that rate isn’t everything.
You also need to look beyond the offer and consider the people making the offer. You want to stick with reputable lenders that are known for doing honest business. Too many people have been tricked by overly sweet promises, only to get hit by fees, restrictions and other details hidden in fine print.
Apply For Refinancing
You should only apply once you’ve made a decision you are fairly confident in your decision. While applying for refinancing doesn’t necessarily mean you have to end up taking their offer you don’t want to go through the application possible more times than necessary. .
Jump Through The Necessary Hoops
Once you make a decision and apply the balance of power shifts noticeably. When you’re browsing for loans you’ll notice that lenders will go out of their way to try and convince you to work with them. Once they know you have made your choice it’s their turn to size you up.
One thing to look out for is an appraisal. Lenders want proof that the home they are financing is worth what they’ve been told and they’re likely to send an appraiser to. If you get advance warning of an appraisal then do what you can to make your house look presentable.
The final stretch of the refinancing process can take some time, especially if you go with a company that gets a lot of home refinancing applications. You simply have to ride it out patiently.
Close The Deal
This step can feel like deja vu, taking you back to the day when you closed your first mortgage loan. And with good reason, at this point refinancing isn’t muck different from closing any other deal. Your experience should help you go through the process without too much but don’t get too confident, caution is a helpful ally throughout the refinancing process.
A closing meeting can take some time but it’s important not to rush things. Now is your last chance to look things over and ask any questions. When all is said and the paperwork is signed you’ll have refinanced your home loan. It’s not a quick or easy process but it can be incredibly worthwhile.
Mortgage Capital Associates (MCA)
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Mortgage Capital Associates has been in the mortgage loan business since 1982 serving customers in 31 states and our mission has been to fulfill the home buyer’s dreams of ownership.
With 30+ years of mortgage lending experience, our reputation is based on fast delivery of industry best rates and closing your loans without any surprises. Our Mortgage Loan Consultants are extremely knowledgeable and able to tailor a mortgage to meet the individual needs of our customers. They use the latest comparative analysis software to research and compare a wide variety of loan programs and best option to meet your individual need and financial goals. Our state of the art loan software streamlines the processing of your loan, ensuring quick approvals and fast closings for you.
MCA has over 25 years of customer satisfaction and our integrity is reflected in our “A” rating with the Better Business Bureau.
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