I feel like the most important part of the lending process that is often overlooked by loan officers and borrowers, is the beginning stages. The importance of being proactive and getting the required paperwork together and doing one’s due-diligence in providing accurate figures always facilitates a smooth process. Substantial daily and weekly rate shifts happen more often now than ever before. When looking for a mortgage professional that you’re comfortable with while keeping an eye on rates, taking some time to prepare and collect some required items could save you a huge headache. Most people have a good grip on the details of their mortgage, but there’s no substitute for having the exact figures. Below I’ve outlined some important steps to consider before you start shopping for a refinance quote.
Before you fill out a loan application online:
- Double check your last pay-stub to determine exactly how much per month you earn. Most folks could tell you exactly how much they bring home, but are you sure exactly how much you make every month before taxes? A $1000 difference between your actual income and your real gross income could skew your income calculations just enough to cause problems.
- Pull your latest mortgage statement out of your filing cabinet. An important figure we’ll need to consider is your current payoff amount or balance. Again, a few thousand dollar discrepancy may result in a quote that isn’t representative of the real cost of the transaction.
- We’ll also need an approximation of your home’s value. You can check this through your county’s web tax portal, or by checking the last tax statement you received. Wake County’s real estate tax info can be found here. These figures may or may not be completely representative of your real value if you’ve recently completed major upgrades or additions to your home. This is a pretty fair estimate of your current value but if you’re definitely in disagreeance, check out some recent home sales in the area and compare the square footage.
- Check and make sure the rate(s) you believe that you have are accurate. Most lenders, including our firm, provide you a comprehensive quote which details the savings you’ll realize through the refinance. If your real rate is different from the rate you provided, it may change the perceived benefit of the transaction.
- Consider high interest revolving debt that you may currently have. Consolidating some other debt while moving your loan to a lower interest rate may be a very practical and money saving move.
Paper work you’ll need to have:
- One month of pay stubs – showing pay for last 30 days.
- W2’s from the last two years.
- Homeowners insurance company name and contact #.
- Your most recent bank statement.
- Any recent retirement or investment account statement.
Preparation is the key to getting locked into a rate when it’s at a low point. Even if rates aren’t favorable at the moment, take some time with your mortgage professional and get everything ready to pull the trigger.