Things to Do Before You Refinance Your Home

Wednesday, February 14, 2024


Most homeowners think about refinancing their home to cash out on some of the equity they have built up to make a few renovations. Others do so in order to reduce their payments. While these are good reasons, they can have a downside and end up costing you more money in the long run. There are things you can do before you refinance your home to make sure you are on the right track. Go over your reasons and follow these tips to ensure you are making a good decision.

Check Your Credit

Check your credit reports and dispute any inaccuracies. If you have paid off any old accounts, ask to have them removed. Look for any lines of credit or accounts that you didn't open. Call the credit bureaus and ask them about anything you don't understand or recognize. Make sure you understand any unexpected changes in your credit scores. If you notice any small balances, try to get them paid off before you apply for your refi loan. This will improve your debt-to-income ratio and increase your approval odds.

Balance the Pros and Cons

Before you make any major financial decision, go over the pros and cons. Take a look at what your next year will look like financially. Make sure your employment is on solid ground and you don't have any major expenses that may end up surprising you. Look at the interest rates to find out if refinancing will knock them down a little or raise them higher. If your loan is almost paid off, do you really want to add more years back onto it? Will the renovations you plan on making really add substantially to your home's value?

Make a Few Minor Repairs

Making a few minor repairs and upgrades will boost the current value of your home and improve your odds of approval. A coat of paint and a few new light fixtures will go a long way in making your home look fresh and revitalized. Giving your home a good cleaning and eliminating unnecessary clutter will also help. Create more storage space by adding a few shelves and a closet organizer or two. Make sure that everything is put away, so you don't have a lot of dust catchers around your home.

Improve Your Curb Appeal

Improve your home's curb appeal by cleaning your lawn and keeping it neatly trimmed. Make sure all exterior lights are in good working order. Wash your windows and clear out any debris from landscaped areas. Put all the toys and lawn implements away, so your lawn does not look cluttered or messy. Sweep your sidewalks and driveway. It's the little things you do to the exterior of your home that will boost its curb appeal and make it shine. This won't go very far if your home has already been valued

When you finally make the decision to refinance, you will want to visit several lenders, including websites like Rob's Mortgage Loans. You will find many of the answers to your questions, as well as options you may not have considered in the past. Do what you need to do that will allow you to reach your financial goals.

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