Are you filled with worries about refinancing your current mortgage with a jumbo loan? Are you afraid you may not qualify? You aren’t alone, so do not worry. People often feel that they don’t have a chance to get a home mortgage because they can’t satisfy the requirements. This is how the right knowledge can help you get approved. Continue reading for the information you need to know.
Prior to applying for a mortgage, you need to know what is in your credit report so that your refinance can go as smooth as possible. The ringing in of 2013 meant even stricter credit standards than in the past, so you need to clean up your credit rating as much as possible in order to qualify for the best mortgage terms.
When faced with financial difficulties, always talk to your jumbo mortgage lender. Some homeowners tend to give up making their mortgage payments when times get bad, but if they are wise they realize that lenders are often willing to negotiate rather than see the home go into foreclosure. Be sure to call the mortgage provider and about any available options.
Before applying for a jumbo mortgage refinance, pay down your debts. Lenders use a debt to income ratio to verify that you are able to afford a mortgage. A general rule of thumb is 36 percent of your gross income should be available to pay all of your monthly expenses, including your mortgage payment.
Make certain your credit history is in good order before applying for a mortgage. Lenders will scrutinize your past credit to determine how much of risk you are to them. If you’ve got bad credit, do what you must to repair it so that you avoid having the application denied.
Refinancing a home mortgage when interest rates are low can save you thousands of dollars on your mortgage. You may even be able to shorten the term of your loan from 30 years to 15 years and still have a monthly payment that is affordable. You can then pay your home off sooner.
One type of loan that is not normally talked about in relation to refinancing is interest only loan. This type of loan allows you to make low monthly payments for a certain period, then the payment amount increases. These loans are generally used to help you get into a home at a low monthly payment.
While you are in the process of getting a mortgage loan, do not apply for any new credit cards. Every time your credit is checked it puts a mark on your credit score. Too many of these will make it difficult on you if your credit is already a bit questionable.