What You Should Know Before Refinancing Your Mortgage in Boynton Beach, FL
Have you heard about refinancing in Boynton Beach, FL? It is a popular way to reduce your monthly loan payments and qualify for better loan terms. Refinancing is the process of replacing an existing mortgage with a new one. It provides several benefits to homeowners.
For example, refinancing a home loan may allow a borrower to switch from a 30-year home loan to a 15-year one. This way, they can pay off the loan sooner to save money on interest payments. Not only that, but refinancing can also allow a borrower to switch from a variable-rate mortgage to a fixed-rate home loan. If you are thinking about refinance home loan in Boynton Beach, FL, there are some essential things you must know before filling the application. Some of them include:
Your Credit Score
One of the most important things lenders will consider when reviewing your refinance application is the credit score. Lenders demand excellent credit scores from those who want to refinance their home loan in Boynton Beach, FL. A minimum credit score of 760 is required to get lower interest rates on the new loan. Borrowers with a credit score of less than 760 may qualify for refinancing, but they won’t get better interest rates on the new loan.
Your Home’s Equity
Equity refers to the difference between the total money you owe in your existing loan and the current value of your home. It is important to check your home’s equity before you apply for refinancing because you might not be able to qualify for the new loan with low equity.
Your Debt-to-Income Ratio
Debt-to-income ratio is another thing that you should know before you apply for refinancing in Boynton Beach, FL. Lenders generally want to see monthly house payments under 28% of the borrower’s gross monthly income. You might need a debt-to-income ratio of 36% or less to qualify for refinancing in Boynton Beach, FL. However, some lenders may accept your application with a 43% debt-to-income ratio if your credit score is excellent, and you have significant equity in your home.
Interest Rates and the Term
When you are applying for refinancing, you should consider both the interest rates and the term of the new mortgage. It makes sense to go for low interest rates and lower loan terms because these allow you to save more money over the long haul. If you have a 30-year mortgage, you should consider switching to a 15-year loan because this would allow you to save money on interest.
Once you have reviewed your credit score, home’s equity, debt-to-income ratio, interest rates, and the terms of the loan, you can move to refinance your mortgage in Boynton Beach. To refinance your home loan, get in touch with Fourpath Mortgage. Call us at 954-507-7553 or fill the refinance application here. We will do all the work for you and find you the best lenders who are willing to accept your application for refinancing.