Like the rest of the home loan options available, going for a mortgage refi in Orange County, CA, means overcoming some challenges to get the best deal. Navigating the home refinancing market can be complex, and any person new to the industry will likely find it overwhelming, if not confusing. But with the guidance of a mortgage professional, things will get a lot easier.

Taking the following into account will make you a better-informed mortgage refinance client.

Your debt-to-income ratio. In most cases, mortgage companies want to keep the monthly housing payments under 28% of gross monthly income – seen as the threshold for the capacity to manage the monthly payments. That is when the debt-to-income ratio comes in. But how does this math computation work? The sum of all your monthly debt payments divided by your gross monthly income is your DTI ratio.

The equity of your home. Here’s the thing: if you have “negative equity,” it does not make sense to go for a mortgage refi in Orange County, CA. In other words, if the value of your home is now less than it was when you started your mortgage, then it defeats the purpose of refinancing. Knowing how much equity is in your home is an essential deciding factor on whether or not to consider refinancing.

The break-even point. The break-even point concept allows you to determine if refinancing makes sense. It is when you figure out whether or not your monthly savings (from mortgage refinance) can cover the costs. Supposing the total refinancing cost is USD 3600 and you save USD 100 each from monthly payments, it will take three years to recoup your costs. Therefore, refinancing may not make sense if you sell your home within that period.

Your good credit score. As credit score is one key factor for loan approval, an application failing because of a not-so-good credit score is not surprising. There are even instances of applications denied despite a healthy credit score. Lenders agree they want a credit score of 760 or higher to approve and give the lowest possible interest rates.

Online looking for an expert to help you with mortgage refi in Orange County, CA? Consider Homeplus Mortgage today.

Please call 800-958-7587 (PLUS) for inquiries.