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Things You Should Do Before You Refinance Posted byTeam H&L Miami @Real Estate Empireon9/28/2018
Before you meet with lenders to refinance your home, there’s certain steps that you should take to make sure that you are ready to refinance and that the entire process will go smoothly. Whether you want to do a renovation or just get a lower interest rate, refinancing can be useful. These tips will be very helpful to you in making an informed decision.
The Numbers Won’t Lie
Just like when you first purchase a home, you’ll need to take a look at your own financial situation to see if refinancing actually makes sense for you. If you’re less than 30 years from retirement, you may want to rethink getting another mortgage that starts from scratch. You can always consider a 15-year mortgage, knowing that your monthly payments will be higher, giving you some breathing room from another 30 years of mortgage payments.
Know Your Credit Score
You should be checking in on your credit report periodically in order to catch any red flags early. You’ll also know and understand any weak spots in your credit. You’ll have time to eliminate any errors and give your score time to readjust.
You should also get an idea of where you stand with your credit score. Credit card companies often provide this. There’s also a few free services that exist to help you obtain your credit score. Knowing this information can be very helpful when you’re looking to refinance a home.
Find Out Your Home’s Value
Lenders want to know that you don’t owe more than 80% of what your home is worth. An appraisal will be a part of the refinance process, but before you even start, it will be helpful to know how much you owe versus how much your home is worth. If you owe more than your home is worth, you may want to reconsider doing the kitchen over or going for that lower interest rate. Moving might be a better option financially.
Get Your Finances Straight
A lender likes to know that you’re in good financial standing before they grant you a loan. Work on paying down your credit card balances and don’t max out any cards that you do have. All this can hurt your credit and your chances of obtaining a loan. You can even talk to some lenders beforehand in order to see if refinancing is a good idea.
Do Your Homework
All lenders are not created equal. You can start with your current lender when it comes to refinancing. Since they want to keep your business, your lender will hopefully have some good deals for you. You’ll need to take some time to compare rates from different companies and find the lowest rates available. If you do your homework, you’ll be able to get the best deals and not regret your refinancing decision.
Team H&L Miami @ Real Estate Empire Group is a fast growing boutique Real Estate firm established in 2001. It began to revolutionize property sales as well as marketing through brokers, agents, and an....