Getting Pre-Approved
One of the first steps to purchasing your dream home is the loan approval process. As part of the pre-approval process, a lender will verify and begin processing your financial information. Your financial information serves as their commitment to lend a specified amount for a home loan. Pre-approval offers several benefits:
- You are afforded the assurance of looking at homes you know you can afford to finance, thereby allowing you to focus your efforts on properties matching your purchasing ability.
- Once you find the home of your dreams, sellers will take your offer more seriously having a lender committed to backing your offer.
- In cases where there may be multiple offers on a property, you have the advantage over a buyer who has not been pre-approved. This can mean the difference of having your offer accepted or losing the property to another buyer.
Should You Refinance
If you own a home, chances are you are going to refinance at some point during ownership. Your goal may be to change or lower the terms of your current loan, or to get cash for expenses such as a remodel, a major purchase, or to consolidate your debt.
No matter what your goal, there are many factors to consider when trying to determine whether refinancing is right for you.
Lower Interest Rates
If interest rates are favorably low, it may be time to consider refinancing. If you plan to stay in your home for several years, the benefits you will gain from lower monthly payments may make good sense. Talk to a mortgage consultant today and find out how.
Closing Costs and Points
Along with lower monthly payments, look at the closing costs and any points. A refinance load with low closing costs may make refinancing an attractive option. There are different ways to pay for closing costs:
- Pay cash at closing
- Roll the costs into your new loan amount
- Add a premium to your interest rate (lender paid)
Also, consider discount points. To the extent that paying discount points may lower your interest rate, this might be an attractive option for you. Your closing costs and any points will need to be factored into your overall break-even point.
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