Refinancing your mortgage can allow you to withdraw some of the money from your home equity or obtain lower interest rates. If you are curious about the mortgage refinance process and time frame, we have provided all the steps involved to give you a better idea of what to expect:
Most commonly, people are able to refinance their mortgage in about one to two months. It will take longer if any mistakes are made in the process, or there are delays that are outside your control. When talking to potential lenders, ask them how long the refinancing process will take to get an idea of the time frame.
Step 1 – Doing Research
Research is an essential first step to the mortgage refinance process. You should begin your research by contacting your current lender. He or she will likely have a lot of your information already, and this will save you the time it would otherwise take to process. Your lender may even forgo charging you for the application. However, if you wish to get the best rate, you should keep your options open. Reach out to other lenders and see what they are willing to offer you. Check out reviews of lenders online or ask your friends and family for recommendations. This way, you can get the best lender possible.
Step 2 – Completing the Loan Application
After you select your lender, they will send you an application. If you come prepared with all the necessary information, this application will not take long to complete. Check with the loan officer beforehand to see which documents you will need.
Step 3 – Getting the Loan Estimate and Disclosures
Once the lender receives your completed application, you can expect a loan estimate and disclosures within three days. The loan estimate will tell you how much you will be required to pay each month and the amount you will owe towards closing costs.
Step 4 – Processing the Loan
Next, your lender will search through and analyze all of the important documents you have given them. If deemed necessary, they will ask you to provide more documents.
Step 5 – Getting a Home Appraisal
Was your home a recent purchase? If it was, then you may not be required to do a home appraisal, which could save you time. If not, you may need to get one. You can have your lender organize an appraisal while she is processing your loan.
Step 6 – Submitting to Underwriters
Often times, underwriting will take up the most amount of time in the entire mortgage refinancing process. This is the part where all of the submitted paperwork is reviewed, to ensure the utmost accuracy. The time frame on this step varies, but on average, it will take between five and eight days. In extreme situations, it may take a few weeks.
Step 7 – The Closing
After the underwriters have finished vetting your paperwork and your loan is approved, you will be able to close on the loan. This will require you to sign all the final loan documents for your refinance. After this is done, your loan will (finally) become official.
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