Refinancing involves writing a new mortgage. This means a couple of things which we will briefly discuss below in this post.
The most important thing to realize is that the lender will not just fork over a new, lower interest rate. You will be asked to bring in income documentation, and your credit score will be checked, just like with your original mortgage. This means, of course, that there will be fees involved. You will have to pay closing costs on this mortgage just as you did initially.
The other important point about writing a new mortgage is the fact that, if your financial situation has changed, you may not qualify for a mortgage, or you may not get a lower interest rate. For example, if at the time of the initial mortgage, you and your spouse both worked full time, and now, one of you has decided to stay home, it does not matter if you are paying the mortgage on time every month, the lender will notice the change in income.
If you are concerned that, due to lower income, you may not qualify for a refinance, you should hop online or talk to a lender in person. If you have lived in your home for a while, you may have paid a good bit down on the principal. Remember, you are refinancing the amount left on the loan, not the original purchase price.
If unsure, check with your local mortgage consultant, current lending institution or even do a search online ! make sure you are properly equipped with the right knowledge and information before going for any mortgage refinancing. Otherwise, you may end up with more issues on hand than you can handle and may end up with more debt and possibility of default issues.
I hope this helps !
The most important thing to realize is that the lender will not just fork over a new, lower interest rate. You will be asked to bring in income documentation, and your credit score will be checked, just like with your original mortgage. This means, of course, that there will be fees involved. You will have to pay closing costs on this mortgage just as you did initially.
The other important point about writing a new mortgage is the fact that, if your financial situation has changed, you may not qualify for a mortgage, or you may not get a lower interest rate. For example, if at the time of the initial mortgage, you and your spouse both worked full time, and now, one of you has decided to stay home, it does not matter if you are paying the mortgage on time every month, the lender will notice the change in income.
If you are concerned that, due to lower income, you may not qualify for a refinance, you should hop online or talk to a lender in person. If you have lived in your home for a while, you may have paid a good bit down on the principal. Remember, you are refinancing the amount left on the loan, not the original purchase price.
If unsure, check with your local mortgage consultant, current lending institution or even do a search online ! make sure you are properly equipped with the right knowledge and information before going for any mortgage refinancing. Otherwise, you may end up with more issues on hand than you can handle and may end up with more debt and possibility of default issues.
I hope this helps !
