Before you refinance San Diego, Greater Home Loans wants to help you become properly prepared.
Documents you’ll need most of the time:
1. Most recent mortgage statement
2. One complete months of pay stubs
3. Most recent 2 years of W2’s and Federal Tax Returns
4. Most recent 2 months asset statement, all pages even if blank.
5. Homeowners insurance declaration page
Now this is usually good enough to get your file started with most lenders and of course there are times when more or less may be required. The documents above, along with your credit report, are the beginning of discovery that may require more explanation.
Setting the right expectation for underwriting will help make the process less stressful. Here’s what to expect: AAAHHHHAHAHAHHH
Although that covers it for most underwriting in San Diego we at ROM Consultants try to ask all questions that underwriting may ask and then present the file complete with the answers. A little extra time spend up front may seem out of the ordinary if you are used to working with a less experienced loan officer but is well worth the time spent.
My disclaimer for underwriting is that the penalties for incomplete files or questionable documentation can result in fines, buyback and penalties from our governmental agencies so the extra care is often a necessity rather than a choice.
Choose your refi type
Rate and Term: Used to lower interest rate; or change repayment terms; or secure fixed financing from an adjustable mortgage.
Cash-out: Use the equity in your home to put cash in your pocket, payoff other debts, and/or remodel your home. Cash-out mortgages usually have tougher guidelines and higher rates than straight Rate and Term refinance mortgages.
Evaluate program terms
There are many refi programs, including conforming, non-conforming, conventional, USDA, FHA, VA and ARM.
For borrowers who are underwater on their current mortgage (i.e. they owe more than the house is worth), the Home Affordable Refinance program is an option. The HARP government program was created to specifically help underwater homeowners adjust their terms. However, only mortgages backed by Fannie Mae and Freddie Mac are eligible.
The program terms include interest rate and repayment period.
You can choose fixed-rate or adjustable-rate mortgage terms. Fixed-rate repayment periods are on the order of 10, 15, 20, and 30 years.
The adjustable-rate option can offer a variety of terms ranging from an initial fixed interest rate period from 1 to 10 years and is usually amortized over a 30 year period.
Find a broker
Remember that you do not need to refinance through your original lender. Choose wisely, and beware of lenders who try to pull you in with suspiciously low rates. Use a mortgage broker like ROM Consultants that offer over 90 approved lenders that fit many consumer needs. One size does not fit all.