Before you switch to another bank, it is essential to understand the administration requirements of the bank you're switching too. What Will you require to refinance your mortgage? Is just one of the questions to answer. You will be required to apply to the new bank and be approved in order for the new bank to start taking over and moving forward with your mortgage.
However, your mortgage application may be rejected by the new bank if you haven't been making consistent payments on your current mortgage. It would be wise to check before you switch or request a report on your mortgage payments to ensure you have been consistent.
Research with a few banks and find those that provide you with the lowest interest rates and also closing costs.
Once you call the bank of your choice and have submitted the credit information, the bank representative will have to ask specific personal questions as part of their standard procedure. This information will include your date of birth, place of employment and social security number.
Once that information has been provided with permission, the representative will then move further to checking your credit history as part of making sure that you meet the bank's credit requirements.
Your application may be rejected if you have missed enough payments on your existing mortgage. If your credit is critical or a debt-to-income ratio is above 36% also it may negatively affect your application.
Refinancing a mortgage will generally include fees and costs such as closing costs, appraisal fee, title insurance, credit report, and points. All the costs can be transferred to the new loan, which will limit your out of pocket expenses by adding it to the monthly payment.
Once you have concluded the paperwork, signed and everything has been approved, a three day rescission period will take place before the loan is complete.
This is done because during a waiting period you are given time to change your mind about the loan or reconsider the different terms of the agreement. Be sure that all paperwork is secure and received from the bank.
It would be advisable to pay down any credit card debt before applying with a new bank, and also keeping in mind that occurrences such as late payments to your current loan may cause the bank to reject your application.
Because banks usually use your credit score to assess your level of risk, it would be best to keep your credit history looking clean. The higher your credit score, the lower your interest rates will be and vice versa.
Get a quote and speak to our expert advisors today.