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A Man's Lawn
When my wife and I were first married, with no kids and plenty of time, I was very meticulous about the care of my lawn. If you were to ask her, she would describe me as "anal." As many of you know, over time having kids along with numerous commitments and a growing business has a way of changing things. My meticulous ground keeping has now become simply a desire to grow grass. As spring emerges it makes me think of many home related activities beyond my ideal beautiful lawn. The aesthetics of your home is important but the financial health of your home is critical. Far too many people who call themselves "advisors" fail to address one of their clients' largest assets and contributor of net worth, their home. Those of you who work with me know that from our planning reviews it is important to be a good steward of your home financially, which means reviewing your loan. So to provide extended advice as a service to you, I've asked a good friend of mine Bob McKearin, to share his thoughts as a mortgage specialist.
Let me know if you have any questions and feel free to reach out to Bob.
When is it the right time to refinance?
First, I want to reiterate the comments made by a Chief Economist at one of the major lending institutions in the country. He says, "People who can benefit from refinancing are literally crazy if they don't take advantage of it now. The risks-rewards are so tilted toward action that it makes no sense to sit on the sidelines."
It is important to realize mortgage interest rates truly are at historic lows! Most homeowners in the country have never experienced mortgage rates at these levels.
So, is it a good time for you? Is it time to "GET OFF THE FENCE"?
When refinancing a mortgage there is more to the decision than just lowering the rate or obtaining a lower payment. Borrowers need to know WHY they want to refinance.
What is the objective?
- Lower the monthly payment
- Reduce total interest costs over the life of the loan
- Consolidate higher interest debt into a lower interest mortgage
- Cash-out equity to access funds for other needs
- Reduce the current term of your mortgage
The list can go on and on. The point is to know what your objective is so the loan can be structured properly. Consulting with your Financial Advisor will help determine the course of action to take. This will help you receive maximum benefit.
Now that you know what your objective is, it is time to get prepared.
It is no secret lenders have tightened credit standards since the real estate crash. The purpose for tighter standards is to reduce defaults and loan buybacks. Accomplishing these objectives benefit us all. Suggestion...don't go into the approval process with a mind set of "doing battle" with your chosen lender. Many borrowers try to tell the lender what they need to complete their job. It doesn't work that way. The lender holds the purse strings and tells the borrower what they need. Save yourself a lot of headaches and provide the documentation requested, sometimes you may have to provide it a second time. Do as requested and it will make your life a lot easier. You will reach your goal to save money much sooner.
Since we are a month away from April 15th when taxes are due, it is a very good time to look into refinancing your mortgage. You are already organizing your financial records so you just need to make copies to provide your lender. The initial documents required when applying for a mortgage are:
- Copies of last 30 days of paystubs
- Copies of last 2yrs of W2's
- Copies of last 2yrs Federal Tax returns including all addendums
- Copies of last 60 days of bank statements (checking & savings)
- Copies of last 2 asset statements (401K, IRA's, brokerage accounts)
(Depending on a borrower's specific situation additional documentation may be required)
Choosing a lender / loan originator...
When choosing a lender it is important to select a lender with a very strong reputation. There are all sorts to choose from: large, small, internet, banks, brokers, etc. but their reputation is a key element. Check the Chamber of Commerce or Better Business Bureau. There is a lot more to consider than just a low rate.
When it comes to a loan originator, select someone who is a specialist in all aspects of loan origination. It is important to select someone who listens to you outline your objectives and then can lead you through the process. Most people rely on recommendations from friends and family because they will learn how reliable and trustworthy their loan originator was.
The goal of a highly professional loan originator is to provide top quality service to their client which will result in multiple referrals from that same client. They want to build relationships with their clients that will stand the test of time. To accomplish this they need to earn their client's trust.
According to economic experts, rates are at historic 69 year lows. Don't sit on the sidelines and miss the opportunity. There are a host of programs to address the needs of many homeowners. The time to obtain a mortgage evaluation is NOW!
Bob McKearin | Branch Manager - Mortgage Specialist Equity Resources, Inc. 7251 Sawmill Rd. | Dublin, OH 43016 | Phone 614-832-1967 | Fax 614-467-3924 Email rmckearin@callequity.net, NMLS #382060. OH MB800302. LO.038669.
The opinions and services of Bob McKearin and Equity Resources are independent of Raymond James.
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