With mortgage rates reaching their lowest point in history, the refinancing stampede has begun in earnest. Lenders are gearing up for the rush, and borrowers are in a rush to lock in rates before they have a chance to bounce back up. But, without the proper preparation, borrowers may find themselves stalled in the process which could wind up being very costly. Be sure to follow these basic refinancing tips to ensure a quick rate lock and a smooth closing.
Do your homework: Gather your documents income verification, bank statements, and tax returns and make copies. Be sure to fill in any blanks, especially if you’re self-employed.
Don’t dawdle: As soon as the lender locks your rate, get your docs in that day. If you delay by a day getting your documents to your lender your application may get buried in the pile. And, have an appraisal done as soon after your application in paperwork are in.
Be a squeaky wheel: Don’t be annoying, but be on top of it. Stay involved. Expect the underwriters to ask for additional information or documents. It’s not uncommon for the loan officer to get tied down and delay getting to you with requests for information. Don’t wait for them to call you. Call them at least once per week.
Anticipate the next move: Don’t be afraid to pin your loan officer down with specific timeframes and milestones. Be especially adamant about the expected lock and closing dates. If there is any indication that their process is being slowed by volume, request a 45 day lock instead of a 30 day.
Look out for the little guy: It’s never advisable to simply go with the first lender you talk with. If the big lenders tick their rates up to slow down the rush, go across the street to the small lender who is willing to do more for you to get your business. Some are being very aggressive with their rates and closing timeframes.