For example, when getting ready to refinance a home loan the obvious question is "what's the cost?" and the follow up question is "what are the benefits?" That may sound elementary, but it's not. That's just the beginning of a series of questions you need to ask BEFORE doing a mortgage loan refinance.
Home loan specialists agree on one thing - most people don't ask enough questions.
 Common Mistakes to Avoid
Here's a crucial question regarding your California home loan refinance: "What is the likely appraised value of my home now and what will my probable loan-to-value be after this mortgage loan refinance?". Home loan approvals depend on acceptable loan-to-value ratios now more than ever.
If you are looking for a cash out home loan refinance then you will want to be sure you can handle the new, higher mortgage payments. Also, when considering cash out, compare the benefits of leaving your existing mortgage in place and getting a second mortgage or a home equity line of credit. You may find this approach would save you money in the long run compared to a home loan mortgage refinance.
A word of caution here: If the cash out you are looking for will be used to upgrade or remodel your home, be sure not to start the construction BEFORE your loan closes. Lenders require that your home is in "move in" condition when they fund your loan.
Compare Home Refinance Loans
Assuming you have done your preliminary review of these questions and decided you do want to do a home loan refinance, you are now ready to compare home loan programs. In many ways this comparison is like the one you did when you purchased your home and even though the 30 year fixed mortgage is the typical choice of homeowners, it is always good to compare other programs.
For example you may find that you will save money on your home loan mortgage refinance loan by choosing an adjustable mortgage such as a 10/1. This program is fixed for 10 years then becomes adjustable. A shorter term fixed rate would be perfect, for example, if you know your kids will be on their own in the next 5 to 7 years and you plan on down sizing.
As you can tell, there really are a lot of things to consider as your compare home loan programs. Call our office today at 800-325-2062 and schedule a consultation with your favorite loan officer or let us introduce you to one of our home loan specialists to help you ask all the right questions. |
