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Ten Tips to Get the Best Refinance Possible!
- Apr
- 07
- Posted by Bregman Properties
- Posted in Blog, Monday Morning Update
Get the Best Refinance Possible!
How Low Can They Go: Mortgage rates are still at or near historic lows. NOW is the time to buy a new house or to refinance your existing mortgage; or both!
I can Help: As a Real Estate Broker I am licensed to work with mortgages too. However, I believe that there is an inherent conflict of interest for a real estate broker to also work with clients on their mortgage.
I believe that my clients are better off if they work with a knowledgeable mortgage professional and a knowledgeable real estate professional. A person who works with real estate clients and mortgage clients is “A Jack of all trades and a master of none”. That being said, I CAN help you evaluate your best mortgage strategy and I can refer you to an excellent mortgage professional.
Find out what your house is worth: Click Here
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Bregman Properties Appreciates Your Referrals!
Ten Tips for a New Mortgage or Refinance
If you’ve been sitting on the sidelines, waiting for the best time to refinance or get a mortgage to buy a home, think of 2013 as your last chance to act.
With good credit, persistence and some shopping skills, you can still snag phenomenal deals this year — even if you are underwater on your loan.
Here are 10 mortgage tips to help you with your mortgage decisions in 2013.
Tip 1: Stop procrastinating and refinance
If you haven’t refinanced recently, you’re probably paying a higher interest rate on your mortgage than you should. Take advantage of today’s record-low mortgage rates while they last. Rates are expected to remain low during the first few months of the year, but they should gradually increase. When they do, many borrowers will regret having missed the opportunity to grab the lowest mortgage rate in history.
Tip 2: Buyers, get moving
With rates near the bottom and home prices on the rise, it’s still a perfect time to buy a house. If you can afford a home and qualify for a mortgage, this may be your last chance to take advantage of the market and own a home for less. To speed up the home buying process, get a mortgage preapproval before you start shopping. (This is a very important tip. Shopping for a house without a pre-approval letter is like shopping at the mall and leaving your wallet at home! – TB)
Tip 3: Compare FHA vs. conventional loans
Many homebuyers opt for a Federal Housing Administration mortgage because it allows them to buy a home with as little as 3.5% down. But the already costly FHA fees that are added to your loan will increase again in 2013. As the costs of FHA mortgages rise, some buyers may consider saving a little extra for a conventional loan. Buyers need at least 5% down to get a conventional mortgage, depending on their credit. If you can afford the slightly higher down payment, get quotes for FHA and conventional loans, and compare the costs. (Ask me for a referral to a great mortgage professional who can discuss what options are available for you. – TB)
Tip 4: Ensure that your credit is golden
Credit standards remain tight. As new mortgage rules are unveiled in 2013, the standards are not expected to loosen. If you plan to get a mortgage anytime soon, you must treat your credit as one of your most valuable assets. Most lenders want to see a spotless credit history of at least a year on your credit report. You’ll need a credit score of at least 720 to get the best rate. Borrowers with a credit score of 680 or more can still get a good deal, but the lower your score, the harder it will be to get approved.
Review your credit report before you apply for a mortgage. Sometimes, paying part of your credit card balances can boost your credit score quickly. Generally, if you are using more than 30% of the available credit on your cards, you may be hurting your score. Also, check for credit errors and have them corrected before you apply for a loan. (Paying off your credit card balances can actually hurt your credit score. Do not do ANYTHING drastic before you speak with a good mortgage person. Click Here to see a list of credit score “Do’s and Don’ts”. – TB)
Tip 5: Want to pay off your mortgage earlier?
If you are one of those homeowners who dream about being mortgage-free, the low-rate environment may be a good opportunity to refinance your 30-year mortgage into a 15- or 20-year loan. But make sure you can really afford the slightly higher payments on the shorter loan and that you have some money saved for emergencies. Click Here to calculate your monthly payment under different scenarios.
Tip 6: Underwater refinancers: Don’t take ‘no’ for an answer
If you owe more than your home is worth and have tried and failed to refinance, why not give it another shot in 2013? The Home Affordable Refinance Program, or HARP 2.0, was revamped to allow homeowners to refinance regardless of how deeply underwater they are.
Even after revisions to the program, many borrowers still found obstacles when refinancing. But the situation is improving. Lenders are much more open to HARP 2.0 refinances these days than they were a few months ago. If one lender says you don’t qualify for a HARP refi, don’t take “no” for an answer, and try to find a lender willing to do it. (This is a very important point. If the first lender you ask cannot refinance your mortgage, ask another lender or two! Persistence usually pays off. – TB)
Tip 7: Give your lender a chance
If you have trouble paying your mortgage, don’t ignore your mortgage servicer. There are new programs available for borrowers who struggle to keep up with their mortgage payments, including forbearance for those with FHA mortgages. Lenders have been more willing to work out delinquent loans through loan modifications and even short sales for homeowners who can’t afford to stay in their homes. It can be a frustrating process to deal with your lender, but communication is still your best tool. (My team and I are available to help you with your short sale if that is the best option for you. – TB)
Tip 8: Shop for a low rate and good service
Even with rates hovering near record lows, you should still shop for the best mortgage deal. Get quotes from at least three lenders and compare not just the interest rate but closing costs and the quality of their service. Favor lenders that have a reputation of closing on time. Start with referrals from friends and relatives when shopping for a lender and read online reviews from other borrowers about the particular lender or mortgage broker you are considering.
Tip 9: Approved for a mortgage? Leave your credit alone
Most lenders order a second credit report for the borrower a few days before closing. Don’t open new accounts or charge up your credit cards at the furniture store while you wait for closing day. New credit lines and maxed-out cards may hurt your score. If you were on the edge when you qualified, your mortgage loan could be rejected at the last minute. (VERY IMPORTANT! – TB)
Tip 10: It’s not over until the loan closes
You’ve submitted your mortgage application and locked a rate. The race has just begun. Submit any documents requested by your loan officer or mortgage broker within 24 hours, if possible. Any delays in responding to the lender or in letting the appraiser into your house are wastes of valuable time. Lenders will remain overwhelmed with the large volume of refinance applications at least through the first few months of 2013. It doesn’t take much more than lost paperwork or last-minute requests from your lender to delay your closing. If that happens, you risk losing the locked rate. Follow up with your lender or mortgage broker at least once a week to ensure the process goes smoothly. (Good communications, and persistent follow up, help to make your refinance move through the system and close on time. –TB)