Have you been thinking about refinancing your home and saying, “I’m going to wait and see if interest rates go even lower?” If this is you, you should probably take a look at jumbo loan refinance. Refinancing your home with a jumbo loan could help you save hundreds overall on your monthly payments.
Are You Eligible for a Jumbo Loan Refinance?
Before anything else, you need to determine your eligibility for a jumbo home refinance first. What do you need?
- High Credit Score: To qualify for a jumbo loan refinance, you need a credit score of at least 700. However, some lenders require higher credit scores to qualify for a refinance.
- Low Debt-to-Income Ratio (DTR): Your DTR is the portion of your monthly income that you use to pay off your debts. The DTR enables lenders to know your capacity to take on additional debt.
- Cash reserves: You need to have a sufficient amount of money in the bank after you close the loan. Generally, you will need to show that you have enough cash to cover over six months of mortgage payments.
How to Get a Jumbo Loan Refinance?
If you are eligible for a jumbo loan refinance, then it’s time to kick off the process. Shop around to get the best rates. That said, get quotes from different lenders as this can help you find the best one for you.
Consider locking in the mortgage rate to prevent fluctuations in the future. This way, you have a set amount to pay every month. Next, you will need to submit all the necessary financial documents, specifically copies of your W-2s, pay stubs, and bank or asset statements.
As you go through the process, the documents will be reviewed by the underwriter. This will take between five and seven weeks with a traditional lender. When all is well, you can expect to receive your final approval and close the new loan.
Is It Worth It?
If you will get lower interest rates, then a mortgage refinance is a smart move. It’s also an excellent option if you’re looking to change the terms of your loan or leverage your home’s equity to help you cover a huge expense.
The best way to determine if a refinance is a good move is to calculate refinancing costs against the potential for short- or long-term savings.
It’s also helpful to speak to a professional to guide you through the process. Doing so will help you make a more informed decision that will make things easier for you financially.
Get a Jumbo Loan Refinance Today
It could be possible that you are paying too much for your home right now. You could be giving the bank more money every month than you need to! When this happens, it can be quite a relief to know that you have an option to pay off your mortgage faster through a jumbo loan refinance. Use the information in this post to help you decide whether it’s the right move for you. Otherwise, you can always explore other mortgage options.