Planning to refinance a new home? Here’s how you can do it

If you are planning to purchase a new home, then one of the ways to mortgage your old home. While many financing companies would accept your mortgage application and help refinance your new home, it would be a good idea to stick with a bank. For starters, all banks tend to follow rules, which translates to no unnecessary surprises. Apart from that, you can count on the bank even helping to guide you, from filing the loan application to filing the required paperwork, as well. And generally, when it comes to banks they tend to be prompt and would let you know the moment your application is approved. Here are a few mortgage tips that you may want to check out.

Get your old home appraised

One of the first things that you need to do is to get hold of a real estate appraiser in Oro County, who can appraise your old home and provide you with a ballpark figure. Remember, that the banks would have their appraisers evaluate your home, before assigning it a dollar value. Once you realize what your old home is worth, you can file a mortgage application with the bank, requesting the bank to extend an equal amount of credit. While banks normally only grant 70% – 80% of the amount requested, a lot of calculations go into this and your home’s net worth would figure prominently in the same.

Check your credit report

Before you even file a loan application with the bank, it may be a good idea to check your credit and see if you can still go ahead and apply for the loan. Usually, banks tend to use credit reports, along with real estate appraisals to evaluate any home mortgages. And some may even insist on a home inspection before they approve of any loan. This is usually done by the bank to assure them that the property has no major issues and can be mortgaged for the stated amount.

Monitor your credit score

It should be pointed out that most credit assessment agencies tend to take a three-month analysis to arrive at your credit score. Simply put, if your credit score is too low, then chances of you getting the loan approved are slim to none. And that’s why you need to pay attention to your score, see if has improved in the last few months, after which you can apply for the loan.

Be realistic

When it comes to loans and mortgages, you will need to be realistic. Just keep in mind that all banks would insist that you cover part of the loan on your own, and this can vary from 10% to 20%, depending on your credit report. So keep your feet grounded and assess your finances, determine what you can afford and whether you can finance a 20% downpayment on your own.

Check for penalties

As a homeowner, there could be various reasons as to why you may be late on your mortgage payments. So make it a point to first check out if the bank levies any penalties for late payments and if the interest on your loan is bound to shoot up.

These are a few essential tips that you need to review before you file a loan/ mortgage application with your bank.