The mortgage industry can be a complex matter, particularly for beginners. There are many industry jargons that, when mistaken, could lead to a decision that isn’t favorable for borrowers. With this, it is imperative to ask questions. It is beneficial to ask for help from experts.
Speaking of asking questions… There are several questions that you need to ask and answer about the factors affecting loan refinance rates, Scottsdale, AZ before you even call your prospective lender to express your intent to refinance. Some of these are the following:
The type of refinancing you apply for. Mortgage experts say that borrowers applying for a rate-and-term refinance will usually pay the same rate as those who are buying a home. If your preference is cash-out refinance, you could be paying a mortgage rate about one-fourth perfect higher if your loan-to-value is at 70% or lower. However, if your loan-to-value is 60% or lower, you don’t usually get charged with an extra cost – even if you choose a cash-out refinancing.
Your credit score. In general, the lower the credit score, the higher the refinance rate will be. Your credit score will have a big impact on your refinancing rate. For instance, while a credit score of 695 isn’t a bad score, having a 760 score or above will give you better chances for lower refinance rates. The former could pay up to one-half a percentage point higher than the latter.
The amount you borrow. This is also important as the amount of money you borrow can also have a significant impact on your refinance rate. Usually, an amount that is greater than the conforming loan limits can make you pay an interest rate of at least three-quarters of a percentage point higher for a jumbo loan. On the other spectrum, once your loan amount touches below USD 150K, a small add-on to the interest rate is usually improved.
You home mortgage experts at HomePlus are readily available to attend to your other questions about refinance rates, Scottsdale, AZ.
Contact us at (800)810-PLUS (7587)