Green Trust Cash Refinancing 101 - What You Need To Know Before Refinancing

Green Trust Cash Refinancing 101 - What You Need To Know Before Refinancing

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Refinancing can be complex. Sitting down with a lender can be a scary thing. Stacks of paperwork and complicated jargon make the process less than appealing. However, having a basic understanding of refinancing can save you time and money. Here are the basics that can help you understand how, when, and why you should refinance.

1. Equity
Borrowers need at least 20% equity of the total mortgage to qualify without paying private mortgage insurance (PMI). Adding PMI to the cost of a new loan could outweigh the benefit of refinancing.

2. Credit
Credit scores play a big part in securing a good mortgage rate. In general, experts say that a minimum credit score of 620 is required to secure a home loan. For those who can't qualify, Patrick Cunningham of Home Savings & Trust Mortgage (HST) in Fairfax, Virginia recommends an increasingly popular approach, cash-in refinancing. "Some people are opting to bring cash to the settlement in order to pay down their green trust cash payday installment loans no credit check balance to qualify for a refinance," says Cunningham.

3. Debt-To-Income Ratio
The debt-to-income ratio is used to measure an individual's gross income that goes toward paying debts. For every dollar borrowed, lenders will require borrowers to generate x dollars in gross income. This mitigates risk for the lender and keeps borrowers from buying too much house. This ratio varies from lender to lender, but having a DTI ratio around 36% is ideal.

4. Documents
It is recommended that potential borrowers submit all documents requested by a loan officer or mortgage broker within 24 hours. Delays in responding to the lender or hiccups with the appraiser can lead to expensive problem down the road. Lenders remain overwhelmed with refinance applications. Late or lost paperwork can delay your closing or the whole deal altogether. This means losing your locked rate and having to start the process all over again. Check in with your lender or broker at least once a week to ensure a smooth transaction.

5. Break-Even Point
Loan officers tell borrowers that refinancing will cost 3% to 6% of the total loan amount. Using a refinance calculator can show you how long it will take to reach the break-even point, when the savings begin to outweigh the costs. "If the break-even is at 15 months and you plan to stay in the home for five years or longer, it is probably worth it to refinance," says Cunningham of HST Mortgage. "But if you plan to move in two years, it may not make sense."

6. Second Mortgage
Borrowers with a second mortgage will face additional difficulties when looking to refinance. "Borrowers can either pay off the second loan or combine the two loans into a larger first mortgage," says Cunningham. "Otherwise, the lender holding that second green trust cash tribal money must agree to stay in second position behind the lender of the first mortgage, which the lender may or may not be willing to do."

7. Retirement
Anyone considering refinancing should consider whether they want to retire without a mortgage before opting for a new 30-year loan. Those who have employment concerns may want to refinance into the lowest possible payment in case they experience a job loss.

To the layman, refinancing can be overwhelming and complicated. However, understanding the basics can serve as a power tool and save you time and money. Remember to secure adequate equity and always seek to improve your credit. In general, lenders order a second credit report a few days before closing. Try not to open new accounts or engage in excessive spending on your credit card prior to closing. Oftentimes, maxed-out credit cards and new credit lines hurt your credit score. If you already have poor credit, your loan could be rejected at the last minute. Take care of this and the other issues mentioned above, and you should be on your way to refinancing success.

For an easy, personalized refinance quote, visit http://www.Money360.com or say "Hi" on Twitter (@Money360) or Facebook at Facebook.com/Money360

If you are looking for refinancing options or want to compare best mortgage rates, visit Money360 to get three custom green trust cash i need a installment loan with no credit check offers.

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