The idea of buying and financing a home can feel overwhelming, especially if you are a new home buyer or your credit is not so good. Another aspect of home ownership is refinancing, which can be a good option if you are already locked into a mortgage that seems to be more than you can handle per month. A trip to a Burlington mortgage broker is your first step in looking into buying or refinancing.
Why Refinance Your Mortgage?
Your Burlington mortgage broker will help you with refinancing, which is a great way to lower your interest payments and save money, even if your credit rating is somewhere in the middle. We’ve got some top tips from Burlington mortgage brokers that can help you with getting that refinance approval, even with a low credit score.
Tips for Refinancing Your Mortgage
Make Your Refinancing Application Look Attractive
Doing something as simple as having all of your financial information in order can make a dull looking application look better to potential lenders. Make sure you have pay slips, tax documents for the prior year, and any other documents that will support your application, such as letters that show upcoming changes in your pay (if you are due a promotion or pay rise). Your job history is also important, so it’s a good idea to request a letter showing the tenure of your employment with your company.
Realistic Expectations
There are many steps that are involved in refinancing. If you are expecting to get lower interest rates or that the process will be a piece of cake, you could be disappointed. The deal that your Burlington mortgage broker gets for you will be the best that is available with the current interest rates and market environment. It’s better to be realistic about what you can get or you may find it hard to find a deal you are looking for.
Property Equity
If you owe more on your mortgage than your home is worth, not many lenders will be willing to refinance your mortgage, regardless of how great the home is. Lenders will base their loans on what the market value is of your property. Different lenders will want different amounts of equity in the home. Your Burlington mortgage broker will be able to help you find a lender that suits your situation.
Your Break-Even Point
Going from a 6% to a 5% rate of interest may sound simple, but that’s not always the case. There can be fees and costs that are associated with your mortgage refinance, such as closing costs, that will need to be considered as well. As your trusted Burlington mortgage brokers, we advise that in some cases refinancing your mortgage is only beneficial if it will save you at least one-half percent of the current interest rate you are paying.
Sitting down with a Burlington mortgage broker to review what refinancing options are available will help to see if this is the right option for you.
