The Myth About Qualifying for Mortgage Refinancing
It’s a common misconception that homeowners must have exemplary credit scores to qualify for a new loan or to refinance an existing mortgage, but this is far from the truth. Homeowners who hold an existing mortgage are – in most cases – eligible to refinance their current loan.
Unless you have experienced a significant decrease in your credit score, are recently unemployed, or have had another major life change, you should easily qualify for mortgage refinancing. For homeowners with extenuating circumstances, there are still options available for decreasing or temporarily pausing your mortgage payments.
Now Is the Time to Shop for Low Refinancing Rates
One reason people give for not refinancing their mortgage loans is the belief that they’re not going to get a better rate than the one they already have, but with record-low interest rates, that’s an increasingly unlikely scenario.
Unless you have recently refinanced your mortgage, there’s a good chance you are paying more than you should in interest. However, many people are hesitant to refinance, intimidated by the process of shopping around or concerned that it will take too much time and effort to find a lower rate.
Mortgage Rates As Low As 2.5% For A Limited Time
United Wholesale Mortgage (UWM) is offering mortgages rates for as low as 2.5 percent for buyers meeting certain criteria who can close soon. Titled “Conquest,” this new program is designed to increase demand for homes and spur a strong purchase season despite the economic impacts of COVID-19 across the country.
UWM is the nation’s largest purchase mortgage and wholesale lender, but it doesn’t deal directly with borrowers. It works with independent mortgage brokers, such as Kensington Research & Recovery, Inc., who can offer these lower rates to customers. UWM’s “Conquest” program offers mortgage rates that are a full percentage point below what was available recently, according to news reports.
How to Prepare for Mortgage Refinancing
With rates bouncing into near historic lows, it might seem like a great time to look into mortgage refinancing. But with so much still unsettled in the economy and the coronavirus fallout still uncertain, experts expect rates – and processes – to fluctuate for weeks to come.
It’s a combination of factors that has left many lenders with a record number of re-finance applications and a diminished capacity for processing them. Lenders are taking two to three times longer to process loans, according to our mortgage expert.
At the same time, the mortgage secondary market – in which investors purchase packages of closed loans – is showing little interest in packages of loans with very low interest rates during a period of heightened economic risk.
Protect Your Investment with Kensington Mortgage Brokerage Services
For most people, a house is likely the most important investment they will ever make, in multiple senses of the word. It’s where you put down roots, raise a family, celebrate with the people you love. It can also be a source of wealth building and financial security.
That’s why it’s so important to protect your investment. That might mean making necessary repairs or improvements. It can also mean not paying more than you should for in interest or mortgage fees.
A small change in your mortgage interest rate can cost you tens of thousands of dollars over the life of your loan.