Refinancing can help you accomplish many different goals. The most common reasons to refinance include reducing your interest rate or payment, converting from an adjustable to a fixed rate, or pulling cash out of your equity to consolidate debt or improve your home. At FitzGerald Financial Group, we can help you determine whether or not refinancing is right for you.
What if I have a second mortgage on my home? Can I still refinance?
Second mortgages may be paid off through the refinance. We will consolidate both loans into one new first mortgage and you will only have one payment each month. If you’d prefer to keep your second mortgage intact, we may be able to ask your second mortgage lender to remain in second position and allow us to refinance the first loan. This process is called subordination and there is typically a fee charged by the second mortgage lender.
Am I allowed to refinance if my property value is less than what I owe?
There are options that may allow you to refinance your loan even if the value of your home is less than what you owe. Call and speak with one of our Hometown Lenders to see if you qualify for one of our programs.
What are the costs associated with refinancing?
Each situation is different. Standard fees generally apply. Contact one of our Hometown Lenders for details.
What type of documentation do I need to refinance?
Standard documentation collected for a refinance transaction includes information regarding your income such as pay stubs covering the most recent 30 days, W-2s and tax returns for the last two years, asset information such as bank or mutual fund/stock statements covering the last 60 days and current loan information such as your most recent mortgage statement and homeowners insurance declarations page. Additional documents may be required.
Can I refinance with blemished credit?
Depending on the reasons why your credit is imperfect, there may be loan options available. Call and speak with one of our Hometown Lenders to determine whether or not you qualify for one of our programs.
Is it true that you should only consider refinancing if you can lower your rate at least .5%?
There is no rule-of-thumb when it comes to refinancing because there are different reasons to refinance. If you are currently in an adjustable rate looking to get into a long-term fixed loan, your rate and payment may actually increase, but you will be in a better long-term situation knowing your rate and payment will remain stable. If you are looking to consolidate debt, your loan amount and mortgage payments may go up but your overall monthly outflow will decrease because you will have eliminated some or all of your credit card bills and other monthly obligations. There are also no-cost and low-cost refinance options that can lower your rate and payment with no or minimal investment. It is a good idea to go over your specific situation with a FitzGerald Financial Group loan officer to determine whether refinancing makes sense for you.
What happens at the loan closing?
Depending on where your property is located, you can either sign the documents associated with your loan in your home or at a designated settlement location such as an escrow office or attorney’s office. Typically, this is done in the presence of a settlement agent. If a financial contribution is required, a certified or cashier’s check will be necessary.
The Refinance Process
One of the most important steps before deciding whether or not refinancing can benefit you is to determine what your objectives are. Is your goal to reduce your monthly payment or pull cash out of your equity for home improvements or debt consolidation? Are you looking to fix your adjustable rate? Once you determine your goals, you can take a look at the various loan programs available to decide which loan option helps you achieve those goals.
Step 1: Meet with a loan officer- Once you've defined your goals and researched all the loan options available, you can submit your information online or pick up the phone to speak with one of our mortgage experts. Your loan officer can answer any questions you have about the loan program you're considering or can make a recommendation for you given your individual goals. We'll make sure that you understand every detail of your loan program and answer any questions you have before moving forward. When you're ready, you can apply online or call us to speak with a loan officer.
Step 2: Select your loan program- If you decide you'd like to move forward with the refinance, your loan officer will confirm your loan program, rate, and payment and will answer any questions you may have. At this point, you may be able to lock in your interest rate to protect you against any fluctuations in the market.
Step 3: Submit your documents- We will provide you with a list of items for you to send us so that we can verify all your information to get your loan approved and closed quickly. We will also send you some preliminary disclosures to review and sign which detail the terms of your rate and loan. An appraisal may be required.
Step 4: Processing- After we receive all your documents, you will be contacted to go over the next steps, which includes ordering the preliminary title report and coordinating with all the necessary parties to ensure your loan progresses smoothly and quickly. Once we have everything we need, your loan file will be submitted to the underwriter for review and formal approval.
Step 5: Close your loan- Upon approval, you will be contacted to schedule your closing.
- Copy of current mortgage statement
- Copy of current survey if you have one
- Copy of Homeowners Policy (Declaration Page)
- Copy of deed
- Copy of Title Policy
NOTE: Refinancing an existing loan may result in finance charges being higher over the life of the loan. Reduction of payments may reflect a longer term.