Steps to a Simpler Refinance

Step 1. Gather the paperwork
Most people know that lenders as a general rule will require a wide array of paperwork. Don’t fight it, embrace it. Get yourself a file folder, a big one, and start collecting together the following:

1. Income documents: Pay stubs for the last 2 months, W-2’s or Tax returns (if self-employed) for the last 2 years.

2. Debt & Asset documents: A list of who is owed, the total amount owed, and the minimum monthly payment. An easy way to do this is to make copies of your latest payment stubs for car(s), credit cards, mortgages, etc. Don’t forget to include any student loans. For asset documentation, copy your most recent IRA, mutual funds, and bank statements. Also put together a list of all real estate owned along with the mortgage owed, monthly payments, and proof of rental income if any.

3. Miscellaneous: Provide the name, phone number and account number of your home insurance policy.


Step 2. Help yourself (and your loan officer)
This may seem like simple, “no brainer” advice, but sometimes the simple things are often overlooked.

A. From the start of the loan application until the loan closes (meaning it’s funded, you’ve done the final signing, and the money is in the bank) DO NOT quit your job, buy a car, apply for a credit card or any other form of credit, or otherwise start to build up an insane amount of new debt. Lenders will re-check your credit report and sometimes your employment just before transferring the funds.
B. Appraisals are difficult to get in a timely manner at times because of high demand. As much as possible, accommodate the appraisers schedule to get your loan done A.S.A.P. Don’t re-schedule because of a football game (use your Tivo) or a hair appointment.
C. Make copies of everything you provide your lender and/or loan officer, and keep it in your personal file. A loan file goes through a lot of hands during the process, just incase a document gets lost or misplaced you’ll have a replacement at the tip of your fingers. You will also want to keep in your file the “Good Faith Estimate” and/or “Truth in Lending Statement” for your records.

What will result from this preparation? The application process can go quickly and smoothly, and most likely your loan will be quickly “approved”, not “approved subject to” 439 conditions and 164 additional pieces of paperwork. You can therefore enjoy a simpler, less stressful refinance.