Homeowners often consider refinancing their mortgages for many different reasons. Some homeowners want lower monthly payments, a lower interest rate, or to access their home’s equity. 

Here are the 6 Things to Know Before You Refinance Your Mortgage

1. Understand Your Financial Goals: Before you decide to refinance, you should clearly understand your financial goals and objectives. Do you want to lower your monthly payments? Access some of the equity in your home? Or are you looking for a loan with a lower interest rate and/or a shorter repayment term? Knowing your goals ahead of time will help you determine whether refinancing will help you achieve those goals.

2. Shop Around for the Best Rates and Terms:  Just like when you first purchased your home, you want to shop around and compare rates and terms from different lenders. 

Don’t just settle for the first offer. It could be that a different lender has a better interest rate or more favorable loan terms. A mortgage bank can help you access refinancing options with the best rates and terms.

3. Be Aware of Refinancing Fees: When you refinance your mortgage, you’re likely to incur a variety of fees. The fees may include many different names for these costs: application fees, underwriting or processing fees, discount points, origination fees, and more. 

These names can be confusing and can make it hard to compare different offers. Getting a thorough explanation from a Loan Officer will be helpful in your understanding of these costs and how they will affect your loan.

4. Know Your Credit Score: Your credit score is a key factor in determining the loan terms you’ll qualify for. 

Before applying for a refinance loan, look at your credit score and make sure it’s accurate. If there are any discrepancies, you’ll want to address them before applying. Your mortgage Loan Officer can help you get your credit score and help you improve it. 

5. Consider Your Loan Options: When refinancing, you can choose between a traditional fixed-rate mortgage or an adjustable-rate mortgage (ARM). 

Fixed-rate mortgages are typically the most popular choice because they offer predictable payments. However, ARM loans may be another option in unique situations.

6. Have Your Documents Ready: When you apply for a refinance loan, the lender will need certain documents such as proof of income, bank statements, and other credit history and legal history documents. Having some of these documents ready can help speed up the application process.

What Are the Benefits of Working with a Mortgage Bank for Refinancing?

When you refinance with a mortgage bank, they have the experience and expertise to help you navigate the process. They understand the ins and outs of refinancing and can provide valuable advice on which loan program suits your situation.

Refinancing your mortgage can be a great way to save money or access the equity in your home.

At 5280Lend.com, we are passionate about helping homeowners secure the best lending options. When you partner with us for mortgage refinancing, you can rest assured that we will take the time to understand your specific needs and goals and find the right loan program for you.

Contact us: (303) 220-0355

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