Wednesday, August 21, 2013
Our last Money Matters report examined when to refinance your mortgage. Now let's check what you should do before re-finance.
And with interest rates going up, any delay could cost you a good chunk of change.
Diana Bocco of Yahoo Homes says there are some things you can do to make the process go as smoothly as possible. Here are her tips.
1. Be prepared to source monetary deposits.
Underwriters are now required to obtain letters of explanation, rather than take what's in the application at face value. Be ready to explain the source of any money deposited into your account that is not a payroll check.
2. Don't change jobs before your loan is clear.
Changing jobs can potentially delay your closing. Lenders want stability. They will check to see if you've been working at the same place for some time. And they may check after the closing to see if you're still at the same company. Wait at least two weeks before changing jobs.
3. Check your credit report six months before refinancing.
If there is an error in your credit report you have time to get the problem resolved. Something as small as ten dollars can hurt your credit report.
4. Don't buy anything that requires you to take out a new loan.
Making a big purchase like buying a new car could affect your debt to income ratio, and kill your refinance qualification.
For more information on Diana Bocco's tips, click on our link.