Second mortgages often have higher rates of interest compared to their original mortgage counterparts, and might even carry variable rates which can increase with market requirements. 1 solution that can let you save interest and lock in a lower rate on money borrowed using another mortgage would be to refinance with a new mortgage. A new mortgage can ruin both your existing first mortgage and your second mortgage, saving you money and also consolidating your payments.
Collect information about your first and second mortgage. This should incorporate the financial institutions now holding them, loan account numbers and the payoff accounts including any interest due. If you don’t have the information on hand, contact your existing mortgage company.
Compare banks and mortgage businesses and decide to which one you wish to use for your mortgage. Consider factors such as available prices and terms, convenience and customer support.
Get in touch with your lender to start the application process. When asked what the intention of the loan is going to be, describe to the agent that you want to refinance your first and second mortgages into one loan. Supply the person helping you with all information in your own existing loans.
Calculate the amount of the new loan that you’re applying by incorporating the payoff accounts for the two loans together. Mortgage Loan indicates adding closing costs to the balance of your loan in order to avoid paying for them out of pocket. Inform your loan representative of your preferred amount during the application process.
Provide the lender with any documentation it asks to rate your program. This might include tax returns, house appraisals, evidence of insurance or other verifications. During this time, the lender will decide whether you meet the requirements for the amount required.
Sign the mortgage records provided to you from the lender when it’s accepted your loan. The lender will disburse the funds from the loan to the holders of the old first and second mortgages and complete the payoff for you.