Let’s Prepare for a ReFi!
Getting ready for a ReFi? Don’t panic! Let us help you get prepared by looking over out Preparing for a ReFi Checklist:
- Your $ goals
Why are you Refinancing? Whether it’s to lower your mortgage interest rate, consolidate debt, take cash from your equity, eliminate your monthly mortgage insurance or change the term of your current loan… zeroing-in on your goals will help determine what type of refinancing is right for you.
- What makes sense?
Okay, so we figured out your goal(s). Now let’s sit down and figure out the different ways to refinance:
Pay-off your loan faster:
Perhaps your finances have changed—maybe you got a promotion, a new job, or you’ve combined incomes. Now you’re in a better place to pay your mortgage loan off faster. Shortening the life of your loan means paying less interest. It also means better long-term financial security and moving forward to other financial goals. And, if you refinance at a better interest rate, it’s possible to save money on your monthly payments.
Lower your monthly payment:
Are you reassessing your monthly spending? Maybe you’d like a little more cash flow. Lowering your monthly payment could be the answer, and it’s simple. Interest rates are constantly changing, and sometimes they’re changing in your favor. If rates have decreased since you took out your mortgage, then refinancing could be the right option for you. Also, if you recently had your credit score raised, you can be qualified for a better mortgage interest rate and/or APR.
Consolidate your debt:
Wouldn’t it be nice if all of your loans were the same rate with the same term? Better yet, wouldn’t it be great if one monthly payment could take care of all of them? A comprehensive home loan refinances can consolidate your debt, lower your payments, change your mortgage term, improve your credit score, and even potentially lock in a lower mortgage rate. Life gets hard to manage, let us help make it simple.
Get your cash out of your home:
Are you thinking about taking cash out of your home? It’s simple—as a homeowner who’s built home equity through paying off your primary mortgage, refinancing your home with that built home equity can provide you with the cash you need. Chat with one of our Home Loan Experts about a refinance plan that works best for you.
Cancel your mortgage insurance:
If you owe 80% or less on your mortgage, you may be able to cancel your monthly mortgage insurance (on a conventional loan, it’s a Private Mortgage Insurance known as PMI but on an FHA loan it’s a Mortgage Insurance Premium or MIP). This will help lower your monthly payments.
- Raise those scores.
Cleaning up your finances is a must in achieving the best credit scores; So catching-up with payments and going over your accounts with a fine-tooth comb are dire:
– Pay down loans as much as you can (especially credit cards)
– Consolidate your payments (you can also do this by refinancing)
– Don’t have too many open accounts, but don’t close too many accounts (you still want some account activity)
Your credit scores will determine what interest rates and loans you qualify for- the better the credit scores, the better the loan!
- Get organized!
Getting your financial documents together, ahead of time, will ensure a smoother process. So blow the dust of that file cabinet and venture-in! Tax returns, bank statements, paystubs yadda-yadda…
- Honey, the appraiser will be here any minute…
Getting your home in shape for the appraiser is extremely important in getting the best home assessment possible. Making repairs, staging it accordingly, and sprucing up the interior and exterior is key! And, when examining your home, keep in mind the “$500 Rule”. What is this? Anytime a minor repair needs to be done on your home (whether it’s a few cracked tiles in the kitchen or bathroom, scuffed floors, etc.) the seller will get hit with a request for a $500 credit towards repairs (even if the costs of the repairs is significantly less). With that being said, it’s best to fixe minor repairs yourself before they’re spotted by the potential buyer.
Hopefully, this guide will help you out when preparing for a ReFi! If you want to learn more, speak with one of our qualified specialists here.