Refinancing your home
- How and why?
by Jakob
Jelling
Chances are you
may need a little extra money to get some work done
around the home or perhaps your current interest rate
is 7.5% and the prime interest rate is 6.0% there is
a benefit to restart the clock on an existing
mortgage and save thousands of dollars over the life
of the loan. The first thing you must realize is that
refinancing your home can also be
tax deductible, meaning that you will receive an
extra tax advantage for the closing costs associated
with a refinancing no matter what the condition, even
in bankruptcy!
The
first step of refinancing your home is
finding a reputable lender that will get the job done
right the first time. Think of refinancing similar to
purchasing your home, as the same information is
necessary in order to get started. You will need to
produce the same documentation that verifies who you
are, how much you make and what you currently owe. A
reputable finance company will shop your loan around
to several lenders and get you an acceptance in a
matter of days and in some conditions in a matter of
hours.
Once you
set the ball in motion, you will have to get your
current mortgage holder to provide a statement of
payoff that shows how much you owe at this point in
time. Your home will need to be appraised in value
and an interest rate will be locked in for a period
of 60 days. You will be asked to sign several pieces
of paper to release this information from the
mortgage company. You may also have to turn in the
cover page of your homeowner’s insurance policy
to show the break down of your coverage.
Should all the
paperwork be in order, you will be given a tentative
closing date by a registered title company. It is the
title company’s job to make sure that all
documentation and title pass from the current bank to
the new one at the settlement table. At the close,
you will resign your paperwork and title
documentation over to a new lender. In some cases, it
may be the same lender as the mortgage company that
you currently have. Should you have asked for some
cash back a check will be presented at this time.
_________________________
About
The Author
Jakob
Jelling is the founder of www.cashbazar.com. Visit his website
for the latest on personal finance, debt elimination,
budgeting, credit cards and real estate.
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