Tuesday, December 2, 2014

Refinancing Your Home

Many people choose to refinance their homes for a number of reasons. Some want a better rate so they can save more by paying less on their mortgages. Others may need the money to make repairs. No matter the reason, there are three key things that must be done during the refinancing process.

Make Sure the Lender is Highly Reviewed and Verified

Just as there are frauds in a number of industries, the same is true for the business of lending. Some lending companies engage in fraudulent practices that leave the customer in a terrible situation in the end. Some have even lost their homes as a result. To avoid this heartache entirely, it is in the best interest of customers to make sure that the lenders are highly reviewed and are verified.

Have Everything Together.

When customers are applying for a new loan to refinance their homes, it will be necessary for them to have documentation that proves they will be able to pay back the loan. Such documentation will include pay stubs, bank statements and tax returns. A good lender is going to ask for at least two years of documentation. Customers who have all of their documentation together before the process even begins will look forward to a speedier approval.

Ask for a Fixed Rate

There are a variety of mortgage options on the market. The best one is the fixed rate option because customers will be able to count on their payments being the same every single month. When payments are the same, customers will easily be able to factor their mortgage payments into their budgets.

It is also important to understand that if people want to ensure that they receive the best home loan refinance rates, they need to make sure their credit is good. Consumers must pay all outstanding debts and ask for letters on letterhead proving the debts have been paid. Copies of these letters can be mailed to credit agencies so credit reports can be updated and bad marks removed.


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