Refinancing continues to be a popular home loan option in many homeowners these days. There are so many reasons why this option has becoming hit. From lower interest rates to solely owning a home after a divorce, you can turn to refinance for help.
If you’re one of the people who decided to jump into the horizon of refinancing, it’s time to prepare all the documents you need for the application. You may not expect your lender to check your request immediately. But you can speed things on your end by preparing ahead of time the papers they need.
The documents needed for refinancing is likely similar to those you submitted in your primary mortgage. These papers will prove different aspects of your finances to your lender.
Here are the seven documents you’ll most likely need for refinancing:
1. Proof of income. This document will prove your income. It may require:
- last 30 days of your payslip
- current tax returns
- tax forms (W-2s and 1099s).
2. Insurance. You may need to produce documents of two kinds of insurance. These insurances are:
Homeowners Insurance that verifies if you have enough coverage for your home.
Title Insurance which helps the lender to check the taxes, legal description of the property, and names on the title.
3. Monthly Debt Load. Even if your lender sees your credit history when they conduct a credit check, you still need to provide to documents. Here’s what your lender may ask you:
- Current Mortgage
- Credit Cards
- Student Loan
- Auto Loan
- Home Equity Loans
4. Credit Information. You need to present documentation of your latest credit score and credit reports.
5. Total assets. You will also be required to provide documentation of your financial assets aside from your home. Here’s what your lender may ask you:
- Saving accounts
- Mutual funds
- Retirement account
- Other real estate property
6. Appraisal. You may also be required to provide a document of the current estimate of the house.
7. Loan to Value Appraisal. A document that shows the house’s worth compared to what you owe on the existing mortgage may also be needed.
These are the seven common documents you’ll need for refinance. Gather all of this and go through the rest of the process of refinancing.