We know you have many decisions in the area of refinancing your mortgage and one of the most difficult aspects of the refinance process is trying to guess if whether or not this certain low interest rate bank that you found online will approve your loan or not. I mean for starters the payment looks good, your credit is pretty okay and your income is fine. So what do you have to lose?
Well, that may sound good and all but for some there is usually some hangup somewhere, for example: My co-borrower’s income or credit has changed, or my co-borrower’s job history have gaps, or my income or credit has some issues. While these are common questions allow us to dig in and help you with a few of these normal traditional borrowing challenges.
- Pulling your credit by yourself for yourself will never bring down your credit score. For example if you visit experian website and all of a sudden you decide by yourself, you want to know what your credit rating is, this will not bring down your credit score. On the other hand if you are apply for a loan, credit card, car financing etc. These intuitions will run your credit and therefore your credit score will drop a few points. Usual 2-3 point per each time. The drop will typically last for 30-60 days and then your score will go back to the original score. WHEW!
- Regarding income, if there has been some gaps in employment or someone has lost a big source of income, then this may need to be looked at by a loan officer so that way you will be able see different loan options available like going with a no documentation loan. A no documentation loan means that you may be able to qualify for a mortgage that can use your income that’s not documented. For example if you say your household income is $9000.00 the bank will basically take your word for it and will not need to see any proof. This income comes in hand for those that are self employed or people that earn cash tips like hair stylist, cab drivers etc.
These are just a couple of tips you can use to help insure your confidence before you speak with a loan officer prior to making that call or submitting your loan. What more word for advice, if you think your income or credit may be kind of sketchy or not as sound as it used to be we highly recommend you talk to a mortgage broker. A mortgage broker will basically take your loan file and submit it to the right bank that will approve you so that way you do not have to do the guessing work yourself. Mortgage brokers also have a pretty good idea which bank will approve your file in advance so this way you can sleep better at night.
Checking your credit in advance allows you to speak with the loan officer therefore he can shop your loan and know where your loan will be placed before needing to get an appraisal, income documentation, title report etc. However if you do not want to check your credit just allow the mortgage banker to check it for you. The cost to the mortgage broker is anywhere in the neighborhood of $25 to $50 for them to see what your credit rating is. The banks check all 3 credit bureaus. The banks you the 2nd highest score to determine which interest rate you will be given for any particular loan you apply for. Using your second highest score can come from Experian, Equifax, or Trans Union.
If you need to calculate your current or future mortgage payment using a certain interest rate, feel free to click here to look at various payment options in advance to be sure refinancing is something that fits your future expectations.