Just as interest rates change over time, so does your situation and refinancing your original mortgage can be a helpful tool toward reaching your financial goals. Refinancing a mortgage can involve new steps in addition to those you may have already encountered when purchasing your home. The following checklist provides a brief guideline to help you get started with refinancing your original mortgage.
- Would you like to lower your monthly payments?
- Do you want to shorten the length of the loan?
- Are you trying to get cash?
Amount owed on current mortgage
- What is your payoff amount on your current mortgage?
- Will you be charged any penalties for early payment?
Is refinancing a good move
- If possible, determine the closing costs of the refinance
- Closing costs typically fall between 0% and 2% of the loan amount
- Estimate the numbers to see if refinancing makes sense for you
The exact documents required will depend on the loan type and program you are using. The following list contains the most commonly needed documents:
- Proof of income
- Proof of home insurance
- Last 2 years tax returns
- Last 2 months bank statements
- Current mortgage statement
You may cancel your loan for any reason during the three-day right of rescission period.