Home Refinance Checklist

Home Refinance Checklist

Home refinancing has become vastly more difficult in the aftermath of the economic crisis. Mortgage lenders have developed a renewed passion for verifying the minute details of prospective borrowers’ financial situations. If there’s a refinance in your immediate future, expect your lender to double and triple-check your credit qualifications. This can be a tedious process, but you can help things along by getting your documentation together in advance. Refinance lenders focus their verification efforts on three areas of your financial picture: your income, your assets, and your debts.

Income verification

•    Two months or more of your most recent pay stubs if you’re employed; a current profit and loss statement if you’re self-employed
•    Two years or more of your most recent W-2s if you’re employed; two years of recent tax returns if you’re self-employed
•    Documentation of other income that will be used to calculate your ability to pay, including Social Security payments, child support, or alimony

Asset verification

•    The three most recent monthly statements of all bank accounts, pension plans, 401(k)s, IRAs, and brokerage accounts
•    Proof of homeowner insurance on the property being refinanced
•    Property deeds

Debt verification

Your lender can verify some of your obligations by pulling your credit report, but that may not reflect the most recent changes in your account. It’s particularly important to be prepared with paperwork if you have recently paid off any debt balances. Our credit repair department can also help you in establishing credit and paying off creditors. Also, since you’re refinancing, you’ll need to authenticate the terms of your existing mortgage loan. The documents you’ll need are:

•    Recent statements for credit cards, your existing mortgage, and student, auto, and any personal loans
•    Loan agreement and the note associated with your current mortgage
•    Divorce paperwork if you’re obligated to pay child support and/or alimony

This checklist of required documentation may be the complete list, but it does prepare you for what lies ahead. There are several stresses in life that require a lot of preparation. A mortgage refinance is no exception. To find out how to make your refinance go as smoothly as possible and to lock the lowest rate today, give First Option a call!