Refinancing your home can be a great option to free up some financial resources to have at your disposal. But before taking any next steps, make sure that you’ve educated yourself on what it means to refinance and learn what is expected from you to complete the process. Get smart and be ready to make the best choices for your situation by considering these three fast facts:
The purpose matters. Review your entire financial picture by evaluating any short and long term goals. Do you want to lower only your monthly mortgage payments or do you want to lower all of your bill payments? Do you need to finance home repairs or college education in the near future? Know the purpose for pursuing refinancing and clearly define your goals up-front so you can identify the best way to accomplish your goals.
Your credit score will play a role. Just like when you applied for your first home loan, your credit score will be one of the risk factors that lenders take into account when evaluating your eligibility for a mortgage refinance. Your score will contain current information on your bill payment history, existing loans, current debt, and other financials. You are entitled to order a free copy of your credit report every 12 months from each of the major credit reporting agencies (Equifax, Experian, and TransUnion) through AnnualCreditReport.com, so before you move forward check your score.
You’ll need personal documents. In addition to all the information about your current loan, you’ll need to gather documents like the last two years of tax returns, two years of W-2s and current paystubs, copies of personal bank statements from the past two months, asset statements, signed loan application and other documentation.
Ready to get started? Contact your Relationship Manager to find the right option for you and move forward with your refinance application.