How to Refinance a Home

Video Transcript

"Hi, my name is Stetson Lowe, and in this clip, we're going to be talking about how to refinance your home. The first step in refinancing is to contact your local mortgage broker, mortgage professional, to get a quote on a possible refinance. Some of the things he's going to need to know in that initial contact is an approximate appraised value. If you can kind of keep track of what similar homes in your neighborhood are selling for recently. He's going to need to know your approximate credit score or he can pull a credit report for you. He's going to need to know your job history and how long you've been employed and how much you make each month so he can compare that with your liabilities from your credit report and come up with a debt to income ratio. Once we've done this, he can then put together a loan scenario based on your loan to value or how much your loan is going to be compared to the value of your home based on your credit score and your debt to income ratio. For the very best interest rates, you're going to want to have about a 740 credit score, 20 percent equity in your home, and have a good job history. Although one or all of these things may not be apparent, it still is possible to refinance. There are some mortgage loans that are not even FICO-score driven at all. So once he has all these pieces of the pie put together, he can come up with a really good quote for you. And if it looks like it's going to be a monthly savings or you're going to be able to consolidate debt to pay it off quicker or save money and put that back in your pocketbook each month, if it's a good idea for you, then you'll just get started by telling him to lock in the rate and sign your compliance documents and get the process started by ordering an appraisal and title work."