10 Mistakes to be avoided while Refinancing Your Home - Part 3
7. Drawing money from Home Equity Lines of Credit (HELOC):
There must be minimum cash out waiting time before you take the cash out of your HELOC. Normally the lenders prefer it to be at least 6 months. A cash-out just before your refinancing can be a sign of your irresponsible credit usage. The lender can reject your loan application too.
8. Signing the refinance loan documents without proper checking:
Before signing in the loan documents, go through the terms & conditions in details. Request the lender to provide the papers in advance so that you can review it properly. At the time of closing it is not possible to check the minute details of the documents as everyone is in hurry.
9. Delays in providing essential document:
If you like you can avoid the unnecessary delay in time of closing. Provide necessary documents to your lender when it’s asked. Otherwise, your closing can be delayed and you can have to face higher mortgage rate and can results in drain of your hard earned money.
10. Giving money on Mortgage Insurance:
PMI or private mortgage insurance is to be paid when you found default on your mortgage. Sometime your mortgage payment increased due to PMI. When you have 80% equity stake in your house, then PMI cannot be demanded. If the refinance is less, then only you can have to pay hefty on private mortgage insurance.
Avoid these mistakes at the time of refinancing otherwise you can have to waste a huge amount of money just for your ignorance.
You can check the previous posts of this post - Part 1 & Part 2
There must be minimum cash out waiting time before you take the cash out of your HELOC. Normally the lenders prefer it to be at least 6 months. A cash-out just before your refinancing can be a sign of your irresponsible credit usage. The lender can reject your loan application too.
8. Signing the refinance loan documents without proper checking:
Before signing in the loan documents, go through the terms & conditions in details. Request the lender to provide the papers in advance so that you can review it properly. At the time of closing it is not possible to check the minute details of the documents as everyone is in hurry.
9. Delays in providing essential document:
If you like you can avoid the unnecessary delay in time of closing. Provide necessary documents to your lender when it’s asked. Otherwise, your closing can be delayed and you can have to face higher mortgage rate and can results in drain of your hard earned money.
10. Giving money on Mortgage Insurance:
PMI or private mortgage insurance is to be paid when you found default on your mortgage. Sometime your mortgage payment increased due to PMI. When you have 80% equity stake in your house, then PMI cannot be demanded. If the refinance is less, then only you can have to pay hefty on private mortgage insurance.
Avoid these mistakes at the time of refinancing otherwise you can have to waste a huge amount of money just for your ignorance.
You can check the previous posts of this post - Part 1 & Part 2
Categories:
Refinance
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