Refinance
1.) Is it cost effective?
There are many reasons to refinance: Lower rate, Lower Term, Cash-out, Home Improvements, Debt Consolidation, Remove PMI, etc. However, it is not always the best move for you. The first step is determining if it is cost effective. Our mortgage professionals can help you make the best decision for your well-being. Call today to determine if this is best route for you. Be sure to provide your current mortgage statement showing balance, rate, and remaining term. If it is determined refinancing will be in your favor, it is time to move on to the preapproval process.
2.) Do you qualify?
Once we have determined if it is cost effective to refinance, the rest of the process is essentially the same as a purchase. We will need the following documentation:
- Income Asset Docs:
- Most recent pay stubs (30 days)
- Most recent 2 bank statements (all accounts)
- Past 2 years tax returns and W2’s
- Awards letters (retirement, social security, etc.)
- Homeowners Insurance
- Property Taxes
- Copy of Deed
- Title Insurance Policy
3.) What type of loan is best for this situation?
There are many different types of programs available to home buyers today: Conventional, USDA, FHA, VA, and Jumbo. Each program has different features and benefits. Some offer 100% financing, while others require down payments of 3.5%, 5%, or 20%. Just because you used one program when you purchased your home, does not mean it will be the best program for your refinance. One of our mortgage professionals can help you understand the differences between all the programs, and determine which is best for you.
4.) Loan Processing & Underwriting
Now the paperwork begins. You will complete a loan application, sign all necessary disclosures and any other docs. All income and asset documents will be verified. Appraisal will be ordered. Quotes for any applicable insurance (homeowners, title, flood, etc.) will be requested. All of these, among other documents, will be sent to underwriting for approval. Additional information may be requested by the underwriters. It is crucial to satisfy all requests in a timely manner due to time restraints set by law. Any new credit inquiries, change in employment, cash deposits, etc, may hinder approval of your loan. Once your loan is approved, you are ready for closing.
5.) Closing
Prior to close your mortgage professional will review and have you sign the closing disclosure. This will explain funds you need to bring to close, all costs pertaining to your mortgage, and any other details. The closing will be held at an attorney’s office in which a closing agent will review several closing documents for your to sign. Once complete, there is a three day rescission period (“cool down period”) before you will receive funding for your refinance.